All about Form MGT 7A for One Person Company and small companies – abridged annual return
The central government introduced companies (Management and administration) amendment rules in 2021. This announcement was verified via a notification in the official gazette. Before this amendment, there was MGT 7 form for annual return for all companies. However, In 2021, form MGT 7A has been introduced for One Person Company and small companies.
What is form MGT 7A?
The Ministry of Corporate Affairs (MCA), India, introduced MGT 7A as an abridged annual return form to simplify the annual compliance process for One Person Companies (OPCs) and Small Companies.
Why Was MGT 7A Introduced?
Earlier, all companies had to file MGT 7, which required a lot of details. To reduce the burden on small businesses, the government introduced MGT 7A in 2021 as a shorter and simpler version.
Who Needs to File?
- One Person Companies (OPC): Companies with only one shareholder and one director.
- Small Companies: Private limited companies with:
- Paid-up share capital ≤ ₹4 crores (Previously ₹2 crores before 2023).
- Turnover ≤ ₹40 crores (Previously ₹20 crores before 2023).
- If a company crosses these limits, it must file MGT 7 instead of MGT 7A.
Introduction of form MGT7A for one company and small companies
- Earlier, every company Private Limited Company, One Person Company, or Small Company registered in India had to file its annual return in Form MGT 7.
- Now, as per the Amendment rules, 2021, Every company shall file its annual return in Form MGT 7 except One Person Company and Small Companies.
- From Financial year 2020-2021 onwards, One Person Company and Small Companies needs to file its annual return in MCA Form MGT 7A.
- Form MGT 7A is required to file with ROC with specified fees.
Documents Required for Filing
- Company Details (CIN, Name, Address)
- Principal Business Activity
- Shareholding Structure
- Board of Directors Details
- Financial Information (Profit & Loss Account, Balance Sheet)
- Other Compliance Details (Whether any penalties, legal matters, etc.)
We provide Pvt Ltd annual filing, LLP annual return filing and OPC annual return filing services, ensuring timely compliance with ROC regulations.
Benefits of MGT 7A for Small Businesses
- Less Documentation : Compared to MGT 7.
- No CS Certification Needed : Cost savings for small businesses.
- Simplified Compliance : Easier and faster filing process.
Due dates for filing MGT7 / 7A
- The due date for filing MGT 7A is 60 days from the completion of 180 days from the end of financial year.
- For filing MGT7, it is within 60 days from the annual general meeting.
Companies (Management and Administration) Amendment Rules, 2021
- MCA has named these amendments as the companies (Management and Administration) Amendment Rules, 2021.
- These amendments are applicable from the financial year 2020-2021.
- You should file a copy of the annual return with the registrar along with the specified fees.
- These rules prevent the disclosure of certain information.
Consequences of not filing MGT 7 / MGT 7A
- According to section 92(5) and 446(B), if a company fails to file its annual return within the specified deadline and its officers who are in default are liable to pay the amount of penalty.
- The penalty for not filing the annual return for One person company and Small Companies is ₹ 100 per day of default.
- All companies must ensure that they file their annual return before the due date.
- Companies may be liable to pay a specified fine.
- The MCA can issue legal notices on company for repeated non compliance.
- If the company fails to file an annual return for constant three years, it is possible that directors may be disqualified.
- If the company is failing to file annual returns for an extended period then, The MCA can strike off the company’s name from the register .
Conclusion
In conclusion, Form MGT 7A is introduced under the Companies (Management and Administration) Amendment act, 2021. The main purpose for introducing this form is to simplify the annual return filing for One Person Company and Small companies. This act ensures a streamlined compliance structure.
Suggested Read :
How to File Form MGT-7 and AOC-4 Online?
Documents to Start a Small Company
OPC Turnover Limit for Small Businesses
FAQs
1. What is MGT 7 and MGT 7A?
MGT 7 and MGT 7A are an electronic form for filing annual return.
2. What is the difference between MGT 7 and MGT 7A?
All companies must file their annual return from MGT 7 except OPC and small businesses. Meanwhile, One person Company and Small companies must file their annual return from MGT 7A.
3. Is MGT 7A compulsory?
Yes, All the registered company in India needs to file MGT 7A for filing annual return.
4. What attachments are required to file MGT 7A?
List of shareholders and debenture holders will be needed to file MGT 7A.
5. When was MGT 7A introduced?
MGT 7A was introduced in 2021 by ministry of affairs.
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