Compliance
Registered Your Company Online? What You Must Do After Incorporation and Every Year
Registering a private limited company online is quick and cheap today. You fill a form, upload documents, pay a package fee, and in a few days you have a Certificate of Incorporation, PAN and TAN. What the package often does not tell you is that the company now has legal obligations every year, from the first year, whether or not it does any business. Many owners discover this only when they receive a notice, or find that their DIN has been deactivated or that they have been disqualified as directors.
This article sets out, in time order, what a newly registered company must do in its first year and every year after. It is written for owners who registered online and now want to understand where they stand. For a detailed checklist, see post-incorporation compliance checklist.
In the first few weeks after incorporation
| Task | Time limit | Notes |
|---|---|---|
| Open the company’s bank account and deposit the share capital | As soon as possible | Subscribers must pay for the shares they subscribed in the Memorandum |
| First board meeting | Within 30 days of incorporation | Adopt the registered office, note the certificate of incorporation, appoint the first auditor, open the bank account, decide on share certificates |
| Appoint the first auditor | Within 30 days of incorporation | A Chartered Accountant; see why audit is compulsory even with no transactions |
| Issue share certificates or credit shares in demat form | Within two months of incorporation | Stamp duty on share certificates applies |
| Directors disclose their interests | At the first board meeting | Form MBP-1 and declarations of non-disqualification |
| Maintain statutory registers | From incorporation | Register of members, directors and others. See statutory registers and records |
Within six months: declaration of commencement of business
A company with share capital must file Form INC-20A, declaring that every subscriber has paid for the shares, within 180 days of incorporation. Until this is filed, the company cannot commence business or borrow. Failure attracts penalties and can lead the ROC to start strike-off proceedings. See how to file INC-20A.
Every year
| Task | When | Notes |
|---|---|---|
| Board meetings | At least four a year (two for small companies and OPCs, one in each half of the calendar year, with the required gap) | Minutes signed and kept |
| Statutory audit | After the financial year ends on 31 March | Every company, even with no business |
| Annual General Meeting | Within six months of the year end (nine months for the first AGM); OPCs are exempt | Adopt accounts; appoint or ratify the auditor as required |
| Financial statements to the ROC (AOC-4) | Within 30 days of the AGM | With the audit report and board’s report |
| Annual return to the ROC (MGT-7 or MGT-7A) | Within 60 days of the AGM | MGT-7A for small companies and OPCs |
| Auditor appointment (ADT-1) | Within 15 days of the AGM at which the auditor is appointed | Usually for five years at a time |
| Return of deposits and exempted loans (DPT-3) | By 30 June | For loans and money received that are not deposits, as well as deposits |
| Directors’ KYC (DIR-3 KYC) | By 30 September, in the year it is due | See how to file DIR-3 KYC |
| MSME dues return (MSME-1) | Half-yearly, if dues to micro or small suppliers are outstanding beyond 45 days | Check if applicable |
| Income tax return | By the due date for companies | Every year, even with no income |
Dates and forms change from time to time; see the annual compliance calendar for the full list.
The first financial year
- The first financial year runs from incorporation to the next 31 March
- If the company is incorporated on or after 1 January, the first financial year can end on 31 March of the following year, giving a first year of up to 15 months
- The first AGM must be held within nine months of the end of the first financial year
Common gaps in online-registered companies
- No first board meeting or first auditor appointment
- INC-20A not filed, often because the share capital was never deposited
- No share certificates issued
- No statutory registers or minutes
- No annual filings, on the assumption that a company with no business need not file
- Director KYC not done, leading to deactivated DINs
- Digital signatures and MCA login held only by the agency that registered the company
What it costs to ignore these
- Additional fees for every day of delay on annual filings, which can become large over a few years
- Penalties on the company and its directors under the Companies Act
- Disqualification of all directors after three years of non-filing, affecting their positions in other companies
- Strike off by the ROC, with directors’ liabilities continuing
If your company is already behind
- Collect the incorporation documents, DSCs and MCA login details
- Check on the MCA portal which forms have been filed and which are pending
- Appoint an auditor if none was appointed, and get the pending years audited
- File the pending forms in the correct order, with additional fees
- Consider whether the company should continue, apply for dormant status or close
- Set up a simple annual calendar so it does not happen again
Frequently asked questions
My company has not started business. Do I still need to file?
Yes. Annual audit and filings are required from the first financial year, whether or not the company has any business.
The online agency registered my company. Will they do the annual filings?
Only if that was part of the service you paid for. Many packages cover only incorporation. Check what was included, and make sure you hold your own DSCs and MCA login details.
What is INC-20A, and what if I missed it?
It is the declaration that subscribers have paid for their shares, due within 180 days of incorporation. If missed, it can still be filed with penalties, but the delay can lead to strike-off proceedings, so act promptly.
Do One Person Companies have to hold an AGM?
No, an OPC is exempt from holding an AGM, but it must still prepare, audit and file its financial statements and annual return.
ചുരുക്കം (Summary in Malayalam)
ഓൺലൈനായി കമ്പനി രജിസ്റ്റർ ചെയ്തവർ അറിയേണ്ടത്: രജിസ്ട്രേഷൻ കഴിഞ്ഞാൽ ആദ്യ വർഷം മുതൽ, ബിസിനസ് ഇല്ലെങ്കിലും, നിയമപരമായ ബാധ്യതകളുണ്ട്. 30 ദിവസത്തിനകം ആദ്യ board meeting, ആദ്യ auditor നിയമനം; രണ്ട് മാസത്തിനകം share certificates; 180 ദിവസത്തിനകം INC-20A. എല്ലാ വർഷവും audit, AGM, AOC-4, MGT-7/7A, DPT-3, DIR-3 KYC, income tax return എന്നിവ. ഇവ മുടങ്ങിയാൽ late fee, penalty, ഡയറക്ടർമാരുടെ അയോഗ്യത, strike off എന്നിവ ഉണ്ടാകാം. DSC-യും MCA login-ഉം സ്വന്തം കൈയിൽ സൂക്ഷിക്കുക.
This article gives a general overview of post-incorporation and annual compliance under the Companies Act, 2013. Forms, due dates, fees and procedures are revised from time to time; for accurate and current requirements, refer to the Act, the rules as amended and the MCA portal. The article is not advice on any particular case.
Please note. This article is provided for general information and is not professional advice or a solicitation of work. The law is stated as understood on the date shown above and may have changed since.