A partnership firm is a kind of business structure in which two or more individuals manage & operate a business in accordance with the terms & objectives set out in a Partnership Deed. In such a business, the members share the liabilities as well as profits of the firm in a predetermined ratio. A Partnership Firm registration is governed by ‘The Partnership Act 1932’ and involves two or more Individuals who enter into an agreement called “partnership deed” to carry on a specified business. Partnership deed is an agreement between the partners in where the rights, duties, profits shares and other obligations of each partner is mentioned. Partnerships are widely prevalent because of its ease of formation and minimal regulatory compliance.
Frequently Asked Questions
Indian Partnership Act, 1932 governs the partnerships. Registration of partnership firm is optional and at the prudence of the partners. Registration of partnership firm can be done at the time of starting the business or during the business partnership. It is always advisable to register the firm because a registered firm avail special rights which are not available to the unregistered firms.
HOWEVER IT IS PERTINENT TO NOTE THAT, IF YOU WISH TO NOT TO GO FOR PROPER ORGANISED REGISTRAR OFFICE PARTNERSHIP REGISTRATION, THEN IT CAN BE SIMPLY FORMED WITH ADDRESS PROOF AND KYC PROOF OF ALL PARTNERS WITHOUT APPROACHING REGISTRAR OF FIRMS.
There is no need for an auditor to be appointed or, if the company is still in the process of registration or in case unregistered, annual accounts filing with the registrar is not necessary either.
Simple to Begin
Partnerships can begin easily with an unregistered deed of the partnership within 2-4 business days.
Easiest Business Structure
Partnership firms are one of the easiest business structures that can be started by formulating a partnership deed for which partnership firm registration is necessary.
Funds can be easily raised in a partnership firm as compare to other firms such as proprietorship firm. Multiple partners can make more feasible contribution; banks also consider a partnership firm more favourable for sanctioning credits and loans.
In partnership firm, all the partners can assign works and responsibilities as per their capability, as mentioned in the partnership deed. Partnership deed helps in avoiding any type of conflicts between the partners.
- Proof of Identity - PAN Card /Passport/ Driving License
- Address Proof - Aadhar Card/Voters ID
- Application for registration of partnership (Form 1)
- Specimen of Affidavit
Proof of the principal address of business can be established by submitting the following documents:
- Sale deed in case one of the Partner owns the place of business
- Copy of Rental agreement if the premises are rented
- Copy of latest electricity bill or water bill or property tax receipt
Sharing Between the Partners
In partnership firm, partners are designate to share the profits as well as bear the losses if any in the course of business.
Existence of an Agency Relation
All partners or any particular partner acting on behalf of others can undertake partnership business. This means each partner is a principal in himself/herself who can act in his own right. Further, he/she can also act on behalf of other partners by acting as their agent.
Unlimited Liability of the Partners
Each Partner is personally liable for all losses arising during business that means their personal assets can be used to pay off the outstanding debts of the partnership firm.
Each partner is entitled to participate in the day to day operations of the business. However, it is not compulsory for each partner to participate in daily operations of the business. But partners running the business need to take assent of other partners for making the requisite decisions.
Duration of the Partnership Firm
The partnership Firm may continue as long as the partners want to keep continue. However, as per law, the partnership can end if any of the partners dies, retires, or becomes insolvent. But the remaining partners can continue their partnership and doing business under the same name after sorting out the due share of the outgoing partner.
The entire Process of Company registration generally takes 2-4 working days. But it may take more days sometimes, due to deficiency in documents, if any.
The partnership firm Registration process is completely online though CA Mantra, so you do not even have to leave your home to get your entity registered.
We can assist you in these processes: -
- Preparing the Documents
- Drafting of Partnership
- Guiding You to Choose A Well-Suited Name
- Notarization of Partnership Deed
- Getting PAN Number & TAN Number
- Obtaining GST Registration
- Taxation Formalities
4 Step for Partnership Firm Registration
In this form, you need to mention the details of the business and partners’ personal details. You need to mention the Name of your partnership firm along with “Co.” suffix at the end of the desired name. However, you can also use the term “Enterprises, Associates, Trading Co., etc not use these terms such as Limited, Private Limited, Foundation, Chamber.
Name Approval is not complicated in the case of Partnership Firm structure. You can choose and keep whatever name you wish to. No Need to go for prior approval with MCA or any authority.
Our expert team drafts a partnership agreement for you wherein all the specifications by the partners are specified. You can verify all the documents and the partnership agreement. After that the final application is forward to the registrar of firms.
Complying to all the guidelines of Indian partnership Act. A certificate of Registration is then issued, by the registrar of firms and a copy should be given to all the partners. Along with PAN & TAN of the firm with opening of a bank account of your partnership firm.
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