Audits Under the LLP Act 2008 –
Section 34 Audit, Form 8, Form 11, Rule 24 Thresholds & Designated Partner Compliance
Audits under the LLP Act 2008 cover every Limited Liability Partnership crossing the prescribed turnover or contribution thresholds. Section 34 read with Rule 24 of the LLP Rules 2009 mandates audit when turnover exceeds ₹40 lakh or partner contribution exceeds ₹25 lakh in any financial year — and every LLP runs an annual compliance calendar that includes audit, Form 8, and Form 11 filings.
Overview
End-to-End LLP Audit & MCA Compliance
N D Savla & Associates handles complete LLP audit and compliance services for LLPs across professional services, technology, real estate, manufacturing, trading, and financial services. We run the Section 34 audit, certify Form 8, file Form 11, manage MCA V3 portal compliance, and coordinate parallel Income-tax Act tax audit — so the full annual MCA-plus-tax cycle moves on a single coordinated workplan.
The Framework
The LLP Act 2008 Audit Framework
The LLP Act 2008 creates a hybrid entity combining partnership flexibility with company-style limited liability. Sections 34, 34A, and 35 together create the complete LLP audit and reporting framework, supplemented by Rule 24 of the LLP Rules 2009 and the Limited Liability Partnership (Amendment) Act 2021:
- Section 34 — books of account maintenance, Statement of Account and Solvency, and audit by Chartered Accountant in practice
- Section 34A — auditing standards specific to LLPs
- Section 35 — Annual Return obligation in Form 11
- Rule 24(8) — audit threshold tests: turnover above ₹40 lakh OR contribution above ₹25 lakh
- Rule 24(11) — auditor appointment by designated partners at least 30 days before financial year-end
- Rule 24(1) — books on cash or accrual basis using double-entry, retained at registered office for eight years
- Section 2(1)(ta) — Small LLP definition under the 2021 Amendment: contribution ≤ ₹25 lakh AND turnover ≤ ₹40 lakh
Applicability
When Is LLP Audit Mandatory?
Audit applicability under the LLP Act follows two threshold tests. Designated partners must monitor both numbers throughout the year — even one threshold breach triggers audit obligation. Capital infusion during the year can take an LLP across the contribution test even where turnover is low.
- Turnover threshold — ₹40 lakh in any financial year, applied to gross turnover from sales, supply, distribution, or services rendered
- Contribution threshold — ₹25 lakh aggregate partner contribution (cash and non-cash, tracked in the LLP's books)
- Either trigger applies independently — even an LLP with low turnover but contribution above ₹25 lakh requires audit
- Small LLP (Section 2(1)(ta)) — conjunctive "and" test: contribution ≤ ₹25 lakh AND turnover ≤ ₹40 lakh
- Higher Small LLP limits — Central Government may prescribe up to ₹5 crore contribution and ₹50 crore turnover
- Auditor qualification — only a Chartered Accountant in practice within the Chartered Accountants Act 1949 can audit an LLP
- Auditor appointment window — at least 30 days before FY-end (Rule 24(11)); first-year LLPs may appoint any time before that year-end
The cleanest practice is to treat any threshold breach as triggering audit. Our team checks every client's threshold position at the start of each financial year so no compliance trigger is missed.
Core Compliance Pillars
Section 34 Audit & The Two Annual MCA Filings
The Section 34 audit and the two annual MCA filings — Form 8 and Form 11 — together complete the LLP's statutory cycle each year. Both forms must be digitally signed by two designated partners using active Class 3 DSCs, and contribution figures must reconcile across both to avoid filing rejection.
Section 34 Audit — The Core Requirement
Section 34(4) read with Rule 24(8) requires LLPs above prescribed thresholds to maintain proper books and undergo Chartered Accountant audit. The audit covers books of account, vouchers, partner contributions, related-party transactions, and the Statement of Account and Solvency. Designated partners bear primary responsibility for auditor appointment under Rule 24(11) — at least 30 days before each financial year-end, with partners able to step in where designated partners fail. Robust book-keeping under Rule 24(1) on double-entry basis supports both the audit and downstream tax compliance.
Form 8 & Form 11 — The Annual MCA Filings
Form 8 is the Statement of Account and Solvency under Section 34 — Part A is the Solvency Statement declaring the LLP's ability to pay debts; Part B contains the Statement of Income & Expenditure and Statement of Assets & Liabilities. Form 8 is due by 30 October (30 days from six months after FY-end), signed by two designated partners and auditor-certified where audit applies. Form 11 is the Annual Return under Section 35, due by 30 May (60 days from FY-end), disclosing partner contributions and designated partner details.
Compliance Streams
The LLP Annual Compliance Streams
Beyond the Section 34 audit and Form 8/11 filings, every LLP runs parallel Income-tax Act and MCA compliance through the year. The streams below summarise the full annual compliance footprint our team coordinates on a single workplan.
Annual audit by a CA in practice — books, vouchers, partner contributions, related-party review, and Form 8 Part B certification.
Part A Solvency Statement plus Part B Statement of Income & Expenditure and Assets & Liabilities; due 30 October on MCA V3 portal.
Section 35 return disclosing partner contributions and designated partner details; due 30 May, reconciled with Form 8 contribution figures.
Designated partners appoint the auditor at least 30 days before FY-end. First-year LLPs may appoint any time before that year-end.
ITR-5 mandatory regardless of activity (even NIL); LLPs taxed at 30% flat plus surcharge and cess. Tax audit if turnover > ₹1 cr or receipts > ₹50 lakh.
Notice of partner addition, cessation, or detail change under Rule 22 — filed within 30 days of the change to keep MCA records current.
Penalties & Risk Anchors
Penalties, ROC Action & Strike-Off Risk
Non-compliance with LLP Act audit and filing requirements carries serious consequences — and unlike most regimes, late filing penalties accumulate without cap. Our methodology is built around the five risk anchors below.
Section 34(5) Penalty for Audit Default
The LLP and every designated partner face penalty for failure to maintain books, prepare accounts, or get accounts audited. Designated partners face personal liability beyond the LLP's exposure — applies in addition to late filing fees.
Form 8 & Form 11 Late Filing Penalty
Late Form 11 attracts ₹100 per day with no cap. Late Form 8 carries a similar daily fee structure. The penalty accumulates indefinitely until filing — every engagement is calendared to deliver well before each deadline.
Strike-Off & Restoration Defence
Continuous non-filing leads to LLP strike-off — the Registrar can strike off an LLP that fails to file Form 8 or Form 11 for prescribed periods. The strike-off process involves notice and opportunity to be heard; restoration applications under Section 80 follow.
Designated Partner Disqualification (Sec 80)
Designated partners face disqualification under Section 80 if they fail to comply with statutory obligations. Personal liability for both LLP-level penalty and individual penalty makes proactive applicability mapping the strongest defensive position.
Integrated MCA & Tax Calendar Discipline
From auditor appointment 30 days before FY-end, through 30 May Form 11, 31 July / 31 October ITR-5, 30 September tax audit, and 30 October Form 8 — every deadline is tracked on a single coordinated workplan to keep the LLP active and compliant.
LLP Audit & Annual Filings Coming Up? Run Section 34, Form 8, Form 11 and ITR-5 Under One Coordinated Team.
N D Savla & Associates handles Section 34 audit, Form 8 certification, Form 11 filing, ITR-5 coordination, designated partner compliance, and strike-off defence — all aligned to one annual calendar. Reach out to discuss your LLP's compliance requirements.
Ready to plan your LLP's annual compliance calendar?
Talk to our team about Section 34 audit, Form 8 and Form 11 filings, ITR-5 coordination, and designated partner compliance — under one integrated workplan.
Get in TouchF.A.Q.
Audit is mandatory under Section 34(4) read with Rule 24(8) of the LLP Rules 2009. Specifically, audit applies if the LLP’s turnover exceeds ₹40 lakh OR partner contribution exceeds ₹25 lakh in any financial year. Additionally, the audit must be conducted by a Chartered Accountant in practice. Furthermore, even one threshold breach triggers audit. Moreover, our team checks every client’s threshold position annually. Therefore, applicability mapping is the first step of every engagement.
Section 34(4) restricts the audit to qualified Chartered Accountants. Specifically, only a CA in practice within the meaning of the Chartered Accountants Act 1949 can audit an LLP. Additionally, the auditor is appointed by designated partners under Rule 24(11). Furthermore, the appointment must be made at least 30 days before the end of the financial year for subsequent years. Moreover, our team handles every audit through practising CAs. Therefore, audit independence and qualification together form the engagement’s foundation.
The two audits are distinct and can apply simultaneously. Specifically, LLP audit applies under Section 34 of the LLP Act once turnover exceeds ₹40 lakh or contribution exceeds ₹25 lakh. Additionally, tax audit applies under Section 44AB of the Income-tax Act once business turnover exceeds ₹1 crore (or ₹10 crore for digital-only) or professional gross receipts exceed ₹50 lakh. Furthermore, our Audits Under the Income-tax Act page covers Section 44AB in depth. Therefore, an LLP often runs both audits in parallel through coordinated engagement.
Form 8 and Form 11 are the two annual MCA filings for every LLP. Specifically, Form 8 is the Statement of Account and Solvency under Section 34 — Part A is the Solvency Statement and Part B is the Statement of Income & Expenditure and Assets & Liabilities. Additionally, Form 11 is the Annual Return under Section 35 disclosing partner contributions and designated partner details. Furthermore, Form 8 is due by 30 October and Form 11 is due by 30 May. Moreover, Form 8 must be auditor-certified where audit applies. Therefore, both filings together complete the LLP’s annual statutory cycle.
Section 2(1)(ta) was inserted by the LLP (Amendment) Act 2021. Specifically, a Small LLP must have partner contribution ≤ ₹25 lakh AND turnover ≤ ₹40 lakh — a conjunctive test using “and”. Additionally, the Central Government can prescribe higher limits up to ₹5 crore contribution and ₹50 crore turnover. Furthermore, qualifying as Small LLP brings reduced compliance burden in several MCA areas. Moreover, our Tax Health Check engagement determines Small LLP eligibility annually. Therefore, the definition matters for every LLP’s strategic compliance choices.
Late filing penalties accumulate without cap. Specifically, late Form 11 attracts ₹100 per day until filing. Additionally, late Form 8 carries a similar daily fee structure. Furthermore, Section 34(5) imposes additional penalties for audit defaults beyond filing fees. Moreover, designated partners face personal liability for both LLP-level penalty and individual penalty. Therefore, our team plans every engagement to deliver well before each deadline. Calendar discipline avoids every cumulative penalty exposure.
Yes. ITR-5 filing is mandatory regardless of activity. Specifically, every LLP must file ITR-5 under Section 139(1) of the Income-tax Act — even a NIL return. Additionally, the deadline is 31 July for non-audited LLPs and 31 October for audited LLPs. Furthermore, transfer pricing cases under Section 92E enjoy a 30 November deadline. Moreover, LLPs are taxed at 30% flat rate plus surcharge and cess. Therefore, our Business Tax Filing team files every LLP’s ITR-5 along with its MCA compliance.
