Registration of companies is a major process, but it is only just the start of the legal and financial obligations of a company. Whichever part of the country you have registered the company (Mumbai included), post-registration compliance is vital in a bid to have a smooth running of the business, regulatory compliance, and credibility in the long term.
A lot of businesses, in particular, startups, and first-time founders fail to consider these requirements, thinking only that they will start complying upon filing of tax returns. As a matter of fact, statutory requirements begin upon incorporation.
This guide describes the main compliance requirements following registration of the company in India, and especially for a private limited company.
1. Opening a Company Bank Account
The opening of a current bank account in the name of the company is the first step required after incorporation. This account should accommodate all other business transactions, such as capital infusion, operation costs, and statutory payments.
In the case of company registration India private limited, the initial paid-up capital shall be deposited into this account as announced on incorporation.
The inability to keep a dedicated business account may result in accounting inconsistency and compliance issues.
2. Appointment of Auditor
All the private limited firms are required to appoint a statutory auditor within a period of 30 days of incorporation. This is very important as the auditor is involved in making sure that there is transparency in finance and that there is statutory compliance.
Key points:
- Even when there is no turnover, the appointment of the auditors is compulsory.
- Form ADT-1 shall be submitted to the Registrar of Companies (ROC)
- Tenure of auditors is five years.
By involving a qualified CA company in Mumbai or the city in which you are operating, one stands a chance of proper audit reporting and compliance adherence.
3. Issuance of Share Certificates
The companies must issue share certificates to the shareholders within 60 days of incorporation. The certificates are a legal demonstration of ownership.
There should also be a share register, and it should be maintained:
- Shareholder details
- Share allotment dates
- Shareholding structure
Poor or late issuance may lead to fines and management problems.
4. Filing of Commencement of Business (INC-20A)
One of the compliance requirements is that Form INC-20A has to be filed within 180 days after incorporation. This statement indicates that shareholders have paid the share capital that was subscribed.
Without filing INC-20A:
- The company is not legally in a position to start a business.
- Bank accounts can be limited.
- Penalties may be imposed.
This is among the most overlooked post-registration compliances.
5. GST Registration (If Applicable)
The registration under GST is required when:
- Turnover is more than the stipulated level.
- The company is involved in inter-state supply.
- The company deals with reported industries.
GST compliance is particularly significant in a business that does company registration in Mumbai because of frequent scrutiny of the department.
GST after registration duties are:
- Timely return filing
- Generation of accurate invoices.
- Reconciliation of input tax credit.
6. Income Tax and PAN-TAN Compliance
In the case of TDS, TAN is required.
Companies must:
- Subtract and add TDS where necessary.
- File quarterly TDS returns
- File income tax returns annually whether profits or loss.
Dormant companies are mandated to make returns even when they are closed.
7. Statutory Registers and Records
The company law in India requires that a number of statutory registers be maintained including:
- Register of members
- Register of directors
- Register of charges
- Board and general meeting minutes.
Such records should be updated on a regular basis and created during the inspections or audit.
8. Board Meetings and Annual General Meeting (AGM)
All companies that are privately limited should:
- Hold its initial board meeting in the next 30 days.
- Conduct at least two board meetings annually.
- At least once a year conduct an Annual General Meeting (AGM).
Resolutions and meeting minutes should be properly documented.
9. Annual ROC Filings
The compliance with the ROC on the annual level is obligatory even in case the company did not conduct any business.
Key filings include:
- AOC-4 – Financial statements filing.
- MGT-7 – Annual return
The lack of ROC filing may result in:
- Heavy penalties
- Directors Disqualification of directors.
- Company strike-off risk
10. Ongoing Accounting and Compliance Monitoring
Compliance after registration is not a single exercise. It requires:
- Regular bookkeeping
- Proper financial reporting.
- Timely statutory filings
- Constant regulatory patrol.
Lack of internal expertise has been identified to be a major problem with compliance in many businesses and results in errors, and deadlines.
By collaborating with a professional CA, the compliance will be proactive instead of reactive.
Conclusion
Compliance requirements should be considered understanding and adhered to after the incorporation and this is vital to the legal status and financial well being of every company. Auditor appointments, GST registration, and ROC filings, tax compliance: every move is critical to the creation of credibility and the prevention of penalties.
To other businesses, who may require professional advice once they go in business, Epsilon Accounts Anusthan Fintech LLP has been found to be able to help the companies remain in line, be organised and focused on growth since inception of the business.
FAQs
1. Are compliances mandatory even if the company has no business activity?
Yes, even dormant or non-operational companies must complete statutory and ROC filings unless officially closed.
2. How soon should INC-20A be filed after registration?
INC-20A must be filed within 180 days of incorporation to legally commence business operations.
3. Is GST registration compulsory after company registration?
GST registration is mandatory only if the company meets turnover thresholds or specific business conditions.
4. What happens if annual ROC filings are missed?
Missed filings can result in heavy penalties, director disqualification, and possible company strike-off.
5. Can a CA handle all post-registration compliances?
Yes, a qualified CA can manage accounting, tax, ROC filings, audits, and ongoing compliance requirements efficiently.
