An annual return is perhaps the most important document required to be filled by a company. Even though Financial statements give information of a company’s financials, this document provides vast in-sight to the non-financial aspects of a company. Every Company registered in Sri Lanka needs to file Annual Returns. This is according to the terms of Section 131 of the Companies Act No. 07 of 2007. The necessary application for filing Annual return is “Form 15”. You could download this form from the official government website drc.gov.lk
Or, you may drop into the Registrar of Companies office in Colombo to get your application form. A company must submit returns within 28 days of their Annual General meeting.
Upon completion of filling of forms, all forms need to be submitted to the Registrar of Companies.
Total charges for registration of Annual Return in LKR.6000 excluding 15% VAT.
What are the company annual returns?
An Annual return provides general information about a company. It consists details of directors, company secretary (If you have appointed one), the registered office, shared capital and shareholdings.
Annual return should be completed up to the 14thday after the company’s Annual General Meeting.
The filing may differ by whether the company has a share capital or not.
Every company having a share capital should include following details in their Annual Return:
A list containing current employees & past employees of the company
The list must include names, addresses and nationalities of the members mentioned. It also needs to state the number of shares held by each member by the date of the return is prepared and withholding Tax in Sri Lanka. If there are shares that were transferred since the last return, then it must be stated as well. If this is the first return of the company then, details of existing and ceased members must be included. It is advisable to arrange names in alphabetical order for the ease of reference.
The Registrar of Companies must be notified if a company has converted any of its shares into stock. The return must make note of it.
- The return must also state the registered address of the company.
- A summary distinguishing between shares issued for cash or in a different mode of payment
It should mention the following particulars:
- The amount of share capital of the company & the number of shares which it is divided into.
- The number of shares taken within the time period of commencement & the date of the return.
- The amount called for each share.
- The total number of calls received.
- The total number of calls unpaid.
- If any, the total sum of commission paid for shares or debentures.
- If shares were issued at the discount, then the details of the discount.
- Since the last return, the total sum of debentures issued at a discount.
- The number of shares forfeited.
- At the date of return, outstanding total amount of share warrants.
- The number of shares comprised in each share warrant.
- All such particulars of directors of the company.
- The total amount of debits of the company; in respect of mortgages & charges.
- The name and address of the auditor or names are addresses of auditors of the company at the date of return.
Annual Return made by company not having a share capital is different.
The return of such a company must file a return every year stating below details:
- The address of the registered company
- All particular details of the directors of the company
The company must issue a statement stating its debts. This may include mortgages and charges under the company.
There are certain general provisions on annual returns. The Director or the secretary of the company must sign the annual return before submitting it to the Registrar of Companies. The Annual return of a non-private company, must include the following documents:
- A written copy, certified by either a Director, manager or secretary of the company to be a true copy.
- A balance sheet (in accordance with the provisions of section 121)
- A copy of the report of the auditors
- If the documents are not in Sinhala, there must also be a certified translation attached
If the company fails to comply with these rules, then the company & every officer in charge will be guilty. They may have to bear penalty.
A private company must submit the following certificates along with their Annual Return:
A certificate signed by a Director or the secretary of the company that the company has not issued any invitation to the public to subscribe of any shares or debentures. This is with regard to the period from the last return, or in the case of the first return since the incorporation of the company. Well, now you should know about the income tax act Sri Lanka.
If a company fails to follow the filing of Annual returns, the company may face up to LKR.100,000 or more in fine. Every officer of the company responsible will face a fine not exceeding LKR.50,000.