Corporations (profit and nonprofit) and limited liability companies (LLCs) organized or registered as a foreign entities with the Department of State in Puerto Rico are obligated to file an annual report on or before April 17th. This applies to all corporations and LLCs formed or qualified on or before December 31st of the previous year --- even if the entity was only in existence for one day. All filings are done electronically. The filing fee for corporations and LLCs is $150 and the fee for nonprofit corporations is $5.
General information required when filing your annual report in Puerto Rico includes:
The corporation's name and the name of the resident agent as registered with the Department of State;
A list containing the names and addresses of all directors and officers of the corporation at the date the report is filed, the expiration dates of their respective terms and their email addresses;
For entities whose volume of business does NOT exceed $3 million, the report must include a balance sheet reflecting the assets and liabilities of the company. Entities whose business volume exceeds $3 million must include a balance sheet audited and certified by an independent certified public accountant licensed in Puerto Rico. The auditor's opinion must include the stamp from the Puerto Rico Certified Public Accountants' Association and the accountant’s seal;
LLCs are only required to file an Annual Fee Statement with basic information; no balance sheet is required.
The Economic Data Survey is required for all filings. This is a two-part questionnaire which includes general information such as current sales amount generated in Puerto Rico, the company’s EIN number and whether the company has any contract with a governmental entity.
Late Filing Fees:
The Puerto Rico Department of State assesses a hefty penalty fee if the deadline is missed. The late penalty fees imposed are as follows:
$750 for corporations
$500 plus 1.5% interest per month for LLCs
$75 for nonprofits
To avoid these expensive penalty fees imposed by the Puerto Rico Department of State, file on time. Corporations have the option to file an extension with the Department of State. However, they must pay the $150 annual filing fee to obtain the extension. The extension is only available for corporations --- NOT LLCs. It grants a corporation 60 days to file its annual report, which extends the filing deadline to June 14, 2017. This extension must be filed on or before April 15th. If a corporation requires an additional extension, until July 15, 2017, a filing fee of $30 must be paid between April 16 and June 14, 2017. No additional extensions are available and the annual report must be filed on or before July 15th to avoid the penalty fee.
Cancellations and Reinstatements
As a precaution, the Puerto Rico Department of State has initiated cancellations of entities for failing to file two consecutive annual reports. Should an entity be administratively cancelled, it can file a reinstatement. The entity will need to submit a Certificate of Renewal and pay a filing fee, plus the penalty fees associated with the missing years. Entities that were cancelled five more years must pay twice the annual report filing fee for each missing year, but no penalty fee will be imposed. For domestic entities, an additional fee to restore will be imposed. The additional fees are $20 for profit corporations, $4 for nonprofits and $80 for LLCs, plus the fees associated with the missing years.
Keep Track of Due Date: No Reminders Sent
When filing your annual report in Puerto Rico, it is important to remember to calendar the due date, as no notice is sent. You will also need to gather the necessary information, including financial statements, in advance, and to make sure the extension requests and annual reports are submitted in a timely way to avoid the large penalties. A knowledgeable service company that offers compliance services can assist with the process and help ensure the entity meets the deadline.
This article is provided for informational purposes only and should not be considered, or relied upon, as legal advice.