All about Form INC 20A- declaring the commencement of your business!
If you are an entrepreneur, you must be aware of several kinds of forms in a business. All these forms help you stay compliant in some way. One such crucial form for every business is form 20A. This form is usually a declaration that the directors of every company files. And they do it during the commencement of the business.
Further, the form 20A that the directors of every company file undergo several stages of verification. It includes verification of the form by the chartered accountant. Or in some cases, the company secretary/a cost account practitioner may also verify it.
As per regulations of company ordinance 2018, every company registered on or after 2nd November 2018 must file the form 20A. That is the certificate that states the commencement of a business from its date of registration.
The directors of a specific company usually furnish this certification/ declaration. However, there is also a due for filing the form 20A. Every company must file their form 20A within 180 days of registration of their company. So, if you haven❜t yet filed your form 20A, you must file it now. This is because; it is one of the most crucial compliances that hold you liable for extreme high-penalties for non-compliance issues.
Companies that are exempted from furnishing the Form 20A
The companies/entities that don❜t have to file their form 20A are:
• Companies that have got their registration before 2018
• Entities that resister after 2nd November 2018, but without any share funds
Duration for filing the form 20A
As discussed earlier, every entity registering after 2nd November 2018 must file their Form 20A within 180 days of the company registration.
Requirements and the process involved
Every business has to file its declaration form 20A within 180 days from the date of registration. And for that, they need to file an E-form to their respective registrar of companies about the same. To file the compliance, the companies need to provide a declaration under section 10A of the companies Act. Further, the companies alsoneed to attach a board resolution along with their E-form.
On the other hand, you also need to provide proof for the declaration. And that includes proof of deposit of the paid-up share capital. If companies are operating with objects that require permission from RBI or India❜s exchange board, they need to acquire such registration and file it with the E-form.
Penalties for the defaulters
If any company who must file form 20A fails to meet the compliance, it would be held liable for the below-mentioned penalties.
• A penalty of INR 50,000 will be imposed on the entity if it fails to file with all the mentioned necessities
• If the registrar thinks that the company is not operating any business after 180 days of its registration, then the ROC can simply remove the name of the entity from the list.
• Officers who are in default would be held liable to pay INR 1000 per day.
Fees for filing20A
|Nominal share capital ||Fee in INR |
|Less than 1,00,000||200|
|From 1,00,000 to 4,99,999 ||300|
|From 5,00,000 to 24,99,999||400|
|From 25,00,000 to 99,99,999||500|
|From 1,00,00,000 or above||600|
Additional payment for late filing
Delay in days
Upto 30 days - 2 x fees
Upto 60 days - 4 x fees
Upto 90 days - 6 x fees
Upto 180 days - 10 x fees
Above 180 days - 12 x fees
Important: Please note that the information on this page / site is provided as general information for better understanding for the user and does not constitute tax, legal, or other professional advice and must not be used as such. Please consult your professional adviser(s) if you have any questions / doubts regarding the above.