A partnership firm is a business structure in which two or more individuals manage and operate a business in accordance with the terms and objectives set out in a Partnership Deed.
Contents of Partnership Deed:
1. The name of the firm
2. Name and details of all partners
3. Date of commencement of business
4. Duration of the firm’s existence
5. Capital contributed by each partner
6. Profit/loss sharing ratio
7. Interest on capital payable to partners
8. The extent of borrowings each partner can draw
9. Salary payable to partners, if any
10. The procedure of admission or retirement of a partner
11. The method used for calculating goodwill
12. Preparation of accounts of the firm
13. Mode of settlement of dues with a deceased partner’s executors
14. The procedure to be followed in case disputes arise between partners
Incorporating a Partnership Firm and registration of Partnership deed is easy, seamless, cheapest and quickest with TeamIndia.co.in! Apart from a Partnership Firm, TeamIndia.co.in also helps entrepreneurs with Private Limited Company Registration, Public Limited Company Registration, LLP Registration, HUF, One Person Company and Proprietorship Firm Registration easily. You may get in touch with our compliance manager on phone number or email [email protected] for free consultation.
Fairly easy to set up and maintain over time
Partnership can be an excellent way of combining different skills and sharing experience to create a powerful business entity. You don’t have to pay corporation or capital gains tax.
A Partnership firm can quickly raise funds as compared to a Proprietorship firm. Even the banks find Partnerships more favorable while sanctioning credit facilities in comparison to a Proprietorship firm.
On account of its very nature, Partnership firm enables sharing of risks by more than 1 person as the profit and losses are shared by all the partners. This ensures diversified financial risks.
1. General partnership – In a general partnership, each partner shares equally in the workload, liability, and profits generated and paid out to the partners. All partners are actively involved in the business’s operations.
2. Limited partnership – Limited partnerships allow outside investors to buy into a business but maintain limited liability and involvement, based on their contributions. This is a more complicated form of partnership, which also has more flexibility in terms of ownership and decision-making.
3. Joint venture – Short-term projects or alliances that bring together multiple partners for a project are typically structured as joint ventures. If the venture performs well, it can be continued as a general partnership. Otherwise, it can be shuttered.
1. Documentation – A Compliance Manager will get in touch with you to obtain your documents along with a simple checklist. You need to fill up that checklist and submit along with your documents for processing. Our expert team will verify documents and proceed with the formalities. All throughout the process, a Compliance Manager will keep you updated on the progress of Firm Registration.
2. Partnership Deed – Upon receipt of your documents, our team will draft a comprehensive partnership deed for your firm. A partnership deed contains very important details of address, commercial terms between partners, their remuneration, interest on capital and profit or loss sharing ratio. Partnership deed will be sent to you for your verification. Once you verify, we will get the same executed.
3. Firm Incorporation – Upon payment of stamp duty and notarizing, Once the registrar approves the application, the firm will be entered into the records. After registration, the Partnership firm will attain legal recognition. Once this is done, we will proceed to apply PAN and TAN for your firm. On receipt of PAN, you may proceed to open your firm’s current bank account with a bank of your choice.
1. Photograph of all the Partners
2. PAN Card of all the Partners
3. ID Proof of all the Partners (Driving License/Passport/Voter ID)
4. Electricity Bill or any other utility bill for the address proof of the Registered Office
A partnership firm is a business form in which two or more individuals manage and operate a business in accordance with the terms and objectives set in a Partnership Deed. This may or may not be registered.
A partnership must have at least two partners. A partnership firm in the banking business can have up to 10 partners, while those engaged in any other business can have 20 partners.
No, registration of a partnership is not necessary. However, for a partner to lodge a complaint or sue another partner or the firm itself, the partnership should be registered. Moreover, for the partnership to bring any suit to court, the firm should be registered. For small or family businesses, it is fine if a firm is not registered.
No, it is not mandatory to have a written Partnership agreement i.e. Partnership deed. However, it is always the best course to have a written document (partnership deed) instead of oral agreements.
Yes. The law presumes that each partner is an agent of the other and dealing in good faith with one partner binds the other partners as well.
Yes. The firm and all the partners are liable for the wrongful act or fraud which causes loss or injury to any third parties.
When the partnership deed does not contain any provision for the duration of the partnership nor conditions for the termination of the partnership, it is a partnership at will.
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