How to meet the annual report obligation for your corporation or LLC

The annual report is the filing that keeps an entity alive in the Registry. It is not a tax return and does not replace one: it is the procedure before the Department of State confirming the corporation is still operating and on what details. The consequence of skipping it is what sets it apart from other late paperwork. The Department of State says it plainly: failing to file the annual report or to pay the annual fee carries penalties and, if persistent, could lead to cancellation of the corporation or the limited liability company. A cancelled entity is not an entity with an outstanding fine.

It applies to corporations, which file the annual report under Chapter 15, and to limited liability companies, which pay the annual fee under Chapter 21. The only exception the Department of State names for the report is religious non-profit corporations. Limited liability partnerships are in a different category: their registration is valid for one year and must be renewed before expiry, because failing to renew on time causes the partnership to lapse.

• Filing the annual report on or before April 15 each year, under Chapter 15 of Act 164-2009, the General Corporations Act.Verified against the official source
• Filing it electronically, through the Electronic Registry of Corporations and Entities administered by the Department of State.Verified against the official source
• If your entity is a limited liability company: paying the annual fee on or before April 15, under Chapter 21, also through the Registry.Verified against the official source
• Complying with the Electronic Regulation of Corporations and Entities, Regulation Number 8688.Verified against the official source

• The entity’s details as recorded in the Registry, and financial statements where they apply according to sales volume. The Department of State has issued circular letters on that requirement, including CC 2023-001 following Act 52-2022.

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   Step 1: Identify which type of entity you have

   This decides what applies to you. A corporation files an annual report under Chapter 15. A limited liability company pays an annual fee under Chapter 21. A limited liability partnership renews a registration that expires after a year. They are three different obligations and confusing them is the most common way to fall out of compliance while believing you are current.

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   Step 2: Mark April 15, do not wait for a notice

   The date is fixed and the same every year. The Department of State has issued administrative orders extending deadlines in particular years, but that is an exception published case by case, not a rule you can count on in advance.

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   Step 3: File through the Electronic Registry

   The report is filed electronically through the Electronic Registry of Corporations and Entities, reachable from the Government of Puerto Rico portal and from the Department of State page. The same Registry is where LLCs pay their annual fee.

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   Step 4: Check whether financial statements apply to you

   The requirement depends on sales volume, and the Department of State has refined it in circular letters: CC 2021-001 and later CC 2023-001, the latter incorporating the changes from Act 52-2022. If your volume is near a threshold, those circulars are the source to read before filing.

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   Step 5: If you are already late, do not let it run

   Non-compliance carries penalties, and the Department of State notes that if persistent it could lead to cancellation of the entity. The difference between one late year and several is the difference between paying penalties and losing the corporation, with everything that drags along: contracts, accounts and permits that depend on the entity existing.

At the Department of State’s Electronic Registry of Corporations and Entities, reachable from the Government of Puerto Rico portal and from estado.pr.gov.

• Believing an LLC has no annual obligation: there is an annual fee under Chapter 21, same date.
• Confusing the annual report with the tax return: they are procedures before different agencies.
• Waiting for a notice or reminder that never comes.
• Counting on an extension before that year’s administrative order is published.
• Letting years accumulate, which is what turns a penalty into a cancellation.
• Ignoring the financial statement requirement when sales volume triggers it.
• Confusing a limited liability partnership, whose registration expires yearly, with an LLC.

These are the government pages this guide is based on.

• Departamento de Estado de Puerto Rico

  Departamento de Estado

  www.estado.pr.gov