One must know what annual return actually means and how it performs. This ensures that whatever money is invested, it is rightly put into appropriate sections to gain the maximum benefit. In this blog we described about Annual Returns Filing Procedure.

What are Annual Returns?

It is a document addressed to the ROC that contains sufficient information about the company, its constituency, and different subject matters relating to the manner and conduct of business by the companies. All companies registered under the acts of 1956 and 2013 must file their Annual Returns at the end of their fiscal year. The Companies Act of 2013 goes further to explain the specific particulars to be included in the annual return: 

• A thorough financial statement
• Information on the directorship or any changes to it
• Information on Debenture Holders and Shareholders
• Disclosure of Charges Against the Company
• Disclosure of Share Transfer
• Information about the registered office

That would be described as Annual Returns in MGT-7 of the Companies Act, to be filed within 60 days from the date of that Annual General Meeting. In the cases of annual returns initiated by the listed companies and the companies with paid-up capital of more than INR ten crores, Form MGT-8 ought to carry the signature of a practicing company secretary.  

Documents Required for Annual Returns Filing

The documents required for annual returns filing are as follows: 

• Balance-Sheet records
• Documents for the profit and loss account
• Documents pertaining to annual returns and, 
• If relevant, cost audit reports

Private companies use multiple forms for annual returns filing with the Registrar of Companies. The forms are as follows:

• Form 23AC: This form is used for filing the balance sheet and it can be applied by any organization.
• Form 23ACA: This form will be used for the account of Profit & Loss. 
• Form 23AC-XBRL: It applies wherein the balance sheet that needs to be filed in the XBRL format.  
• Form 23ACA-XBRL: It is used to file the account of Profit & Loss by any particular class of companies.  
• Form 20B: Companies with share capital make use of this form to file the annual returns.  
• Form 66: This certificate in case of forms where paid-up capital ranges from 10 lakh to 5 crores is to be submitted using this form.  
• Form 21A: It is mainly used by those companies that do not possess share capital for filing their annual return. 
• Form AOC-4: All the financial statements and other important information for certain company types needs to get filed on Form AOC-4.
• Form AOC4-CFS: Statements providing relevant data of the Group’s consolidated financial statements. 
• Form AOC4-XBRL: The financial statements and documents need to be filed in Form AOC4-XBRL in XBRL format.  
• Form MGT-7: The annual return needs to be filed by all companies through this form.

What is the Annual Returns Filing Procedure?

• Maintaining the Book of Accounts: This is the basis for the control over receipts and expenditure in any company and for legal assurance. Every company is bound by its provisions to do so according to the Companies Act, 2013.  
• Preparation of Financial Statements: The book helps in relation to making the financial statement. This, however, ought to accommodate an income statement, statement of financial position, and other statements entitled with notes explaining them.  
• Audit of Financial Statements: The auditor could audit the financial statements based on provisions in the Companies Act of 2013. Every company is bound to appoint its first auditor within a period of one month from its incorporation. Thereafter, the appointed auditor sits for the company, scrutinizes its books, and prepares a report for the members relating to the financial position of the company. 
• Holding the AGM: The AGM is a general meeting of the shareholders of a corporation, to have been held once a year. According to Section 96 of the Companies Act, it is necessary for all companies, excluding one-person companies, that such a meeting is held; the first one should be called within 18 months of incorporation. Besides, such an annual general meeting should be held within 15 months of the last such meeting.
• Annual Return Filing: All companies are required to return documents with the registrar within a certain time after the conduction of the AGM. This includes passing the respective audited accounts for the Ministry of Corporate Affairs in accordance with established standards and life. The annual return and the financial statement should then be uploaded with the registrar within 60 days of said AGM.  

Time Period for Filing the Company’s Annual Return

• The annual return of the company needs to be made within 60 days from the date of the annual general meeting. 
• In the first year of business, the company should conduct its annual general meeting at least 9 months after closing its accounts. 
• For subsequent years, the annual general meeting should be conducted within 6 months after the end of the financial period of the company.

Penalty for Not Filing Annual Return

• A company that fails to file an MCA annual return faces a penalty of Rs. 5 lakhs. Additionally, any officer of the corporation, found in default, could be jailed up to a maximum of 6 months, made to pay a fine, or both. 
• The company shall be marked as stuck off by the company registrar for failure to file income tax returns or MCA annual return regularly.  
• The company’s bank accounts may also get frozen before the corporation is struck off. 
• A company declared as struck off by the registrar would have its directors disqualified from serving as directors for a period of five years.

Conclusion

You may be wondering where to find tax assistance when submitting on deadline with regard to filing your annual return. Professional help on tax matters makes a preparer the proper contact for advice. Otherwise, you can file your taxes using online tax-preparation software and feel a little more relieved with your choice to submit new returns. However, you should think considering taking the help of Whizseed if you want your taxes completed as soon as possible and want individualized attention to any queries or problems you may have.