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Partnership Registartion
Partnership Registartion
When two or more people come together and pool funds to start a business, it’s known as a partnership firm. The primary aim of partnership firms is to earn profit.
Partnership firms in the country are bound by the laws defined under the Indian Partnership Act, 1932. According to Section 4 of the Partnership Act, “Partnership is the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all.”
People who enter into partnership with one another to start a business are individually called “partners” and are collectively a “firm”. The name they give to their business to carry on operations is called the “firm name”, according to the Indian Partnership Act.
Steps to register as a Partnership Firm
- Step 1: Choose name for a partnership
- Step 2: Draft a Partnership Deed
- Step 3: Apply for a PAN Card in the Partnership Name
- Step 4: File a Registration Application
- Step 5: Submit the Documents
- Step 6: Pay the Fees & Stamp duties
- Step 7: Finalize the Deed
- Step 8: Certification from the Registrar
Documents Required
- Duly filled application form with passport-sized photographs
- Identity and Address proofs of partners
- PAN card and address proof of partnership firm (NOC from owner if property is rented)
- Partnership Registration Certificate
- Any registration document issued by state or central government, such as GST Registration
- Any other document required by the respective authority
Benefits of a Partnership Registration
A partnership firm compared to proprietary business has an upside of inculcating more skills, capital and risk sharing; and compared to a company it has an upside of easy processes, and minimal compliance that makes partnership a viable option for small and medium scale enterprises. Some of its key benefits include:
- The partners in a partnership firm get the benefit from risk sharing, unlike an individual in a proprietary firm whose liability can be unlimited
- The most important benefit that arises from the registration is that when there are disputes between or among the partners, a partner can sue the other partners
- Registration also enables the Partnership firm to sue third parties to enforce its claim
- The dissolution procedure for a registered Partnership firm is reliable and quick
In legal disputes, the first thing the court establishes is whether the incorporation is registered. Therefore, it is advisable to get the partnership registered under the Act. You may get in touch with our compliance manager at 9962903855 or email sales@etaxhub.in for Partnership registration.
