The legal identity of the partnership firm is not separate from its members thus the partners are personally liable for discharging the liabilities of the partnership firm. Further, in India the partnership firms are registered under the Partnership Act 1932.
Annual compliances mean conforming to a rule, policy or law and submitting certain reports annually. The annual compliance requirements of the partnership firm are very less as compared to other forms of companies like private limited, public companies and limited liability partnership.
However when the annual turnover of partnership exceeds rupees one lakhs then such firm is required to get its accounts audited. Further, if the accounts of the partnership firm are audited then the returns shall be furnished with DSC attached.
After taking a close look at the compliance requirement of partnership firm it can be concluded that the compliance requirement of the partnership firm is not very stringent. However in order to ensure more efficient working of partnership firms more Compliances can be implemented in light of Wealth Tax, 1957, Excise Duties, Customs Act, 1962, Service Tax and Local taxes, Labor Laws such as Provident Fund Act, 1952, Employees State Insurance, 1948, Minimum Wages Act, 1948, and Factories Act, 1948 can be included for compliance purposes of partnership firm.
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