New Incorporation Compliances

Compliances for Newly Incorporated Company

Given below are brief descriptions of certain compliances a newly incorporated private limited company needs to make within certain time frames:

Appointment of statutory auditor:

Within 1 month of the incorporation, please have a Board Meeting to appoint the statutory auditor. Before making such appointment, the proposed auditor has to confirm that the appointment if made, will be within the limits prescribed under Section 224B of the companies act. After appointment of the auditor, the auditor has to be informed. The auditor will have to file Form ADT-1 within 15 days of receiving the intimation of appointment with the Registrar of Companies (ROC).

Financial Year:

The first board meeting should also decide the financial year of the company. The financial year prescribed under the Income tax act is a period of 12 months ending 31st March. However as per Section 2(41) of the Companies Act 2013, “financial year”, in relation to any company or body corporate, means the period ending on the 31st day of March every year, and where it has been incorporated on or after the 1st day of January of a year, the period ending on the 31st day of March of the following year, in respect whereof financial statement of the company or body corporate is made up.

Allotment of shares:

Subscribers to the MoA: The subscribers to the Memorandum of Association are the first shareholders of the company and they will have to be issued share certificates in the first board meeting. As the shares are allotted at the time of subscription to the MOA, PAS-3  is not required to be filed with the ROC.

Business Registrations:

Depending on the nature of business of the company, there are certain other business registrations required:

 

  • Applying for Permanent Account Number (PAN)
  • Tax Account Number (TAN) for deducting and remitting the Tax deduction at source
  • Service Tax Registration when the business involves provision of services and there is a basic exemption for small service providers where if the Annual Turnover from services is less than Rs.9 lakhs no registration is required.
  • Value Added Tax (VAT) if the annual turnover is less than Rs. 7.5 lakhs (in the state of Andhra Pradesh), no registration is required and beyond that the company has to be registered under Turnover Tax or VAT depending on the turnovers.
  • Import Export Code is required if the company is engaged in importing / exporting.
  • Professional Tax (PT) for every organization by paying certain annual fees.
  • If the company is an employer, will have to register as an employer and start deducting professional tax from employees and remit the same.
  • Such company registered in Andhra Pradesh, is also required to register under AP Shops & Establishments Act.
  • Trade License from the local authority
  • There are other registrations mandatory depending on the number of employees employed like Provident Fund, Employee State Insurance (ESI).