Partnership Firm Registration
In India, a Partnership Firm is one of the oldest and most common forms of business structures. It is governed by the Indian Partnership Act, 1932. Here’s an overview of a Partnership Firm in India
A Partnership Firm refers to an entity formed by two or more people who mutually agree to divide profits / loss in a predetermined ratio.
The partnership deed is a basic legal document on which, Firm is to establish the Partnership Firm Registration.
Documents Requires For Company Registration
- Photo, Aadhar & PAN of all Partners
- Address of Proposed Firm
- Form No. 1 (Application for registration under the Partnership Act).
- Original copy of Partnership Deed, signed by all partners.
- Affidavit declaring the intention to become a partner.
Obligation of Tax Compliances after Obtaining Partnership Firm Registration
- After partnership firm registration or In case of Unregistered Partnership after formation of partnership deed, partners need to obtain PAN and TAN from the Income Tax department.
- Opening Bank Account in the name of Partnership Firm.
- Take GST Registration/ ESI / EPF registration, if Required. After registering for GST, firms must do GST Return Filing and TDS Return Filing on a monthly or quarterly basis. file ESIC/ EPF returns as per requirement of ACT.
- It is mandatory to do ITR Filing annually for partnership firms.
- Partnership firms with an annual income of over Limit as per Income tax Act are required to perform a tax audit.
Packages
- Draft Partnership Deed
- Obtain Firm PAN & TAN
- Draft Partnership Deed
- Firm Registration
- Obtain Firm PAN & TAN
- GST Registration
- Draft Partnership Deed
- Firm Registration
- Obtain Firm PAN & TAN
- GST Registration
- GST Compliance for One Financial Year
Overview Partnership Firm Registration
In India, a Partnership Firm is one of the oldest and most common forms of business structures. It is governed by the Indian Partnership Act, 1932. Here’s an overview of a Partnership Firm in India
A Partnership Firm refers to an entity formed by two or more people who mutually agree to divide profits / loss in a predetermined ratio.
The partnership deed is a basic legal document on which, Firm is to establish the Partnership Firm Registration.
1. Formation
A Partnership Firm is formed by an agreement between two or more persons (partners) to carry on a business together with the aim of making a profit. The partnership agreement may be oral or in writing, but it is advisable to have a written agreement to avoid misunderstandings that is called Partnership deed.
Number of Partners: A Partnership Firm in India can have a minimum of two partners for businesses other than banking, and a maximum of twenty partners. However, in the case of banking, the maximum number of partners is 10 and as per Rule 10 of the 2014 Companies (Miscellaneous) Rules, allowed is fifty members.
3. Management
Partners in a Partnership Firm typically participate in the management of the business. However, the extent of involvement may vary based on the partnership agreement. There can be active partners who are involved in the day-to-day operations and decision-making, and silent or sleeping partners who contribute capital but do not participate in management.
5. Registration
While registration of a Partnership Firm is not mandatory, it is advisable to register the firm under the Indian Partnership Act, 1932. Registered firms enjoy certain legal benefits, such as the right to sue and be sued in the firm’s name. Partnership Firm Registration provides unique rights and advantages over unregistered partnership firms.
However, if your partnership is unregistered, you cannot file a lawsuit to enforce your rights against your fellow partners. Additionally, a registered partnership can file a lawsuit against any third party to enforce its contractual rights, but an unregistered partnership cannot do so. Furthermore, a registered partnership can use set-off or other legal actions to enforce its contractual rights, while an unregistered partnership cannot use setoff in any legal action brought against it.
7. Taxation
A Partnership Firm is not a separate legal entity for taxation purposes. Instead, the income of the firm is taxed in the hands of the partners. Each partner is required to pay tax on their share of the firm’s profits at their applicable income tax rate.
2. Liability
In a Partnership Firm, each partner is jointly and severally liable for the debts and obligations of the firm. This means that if the assets of the firm are insufficient to meet its liabilities, the personal assets of the partners can be used to satisfy the debts.
4. Name
A Partnership Firm can choose any name for its business, subject to certain restrictions. It is advisable to register the firm’s name to prevent others from using the same name.
6. Capital Contribution and Profit Sharing
Partners contribute capital to the firm, either in the form of cash, property, or services. The profit-sharing ratio among partners is determined by the partnership agreement.
8. Dissolution
A Partnership Firm may be dissolved by mutual agreement among the partners or in accordance with the terms specified in the partnership agreement. Dissolution may also occur due to death, insolvency, or retirement of a partner.
Frequently Asked Questions
What is partnership firm?
The 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. It is one of the quickest ways to form a legal entity where a group of 2 or more can do a business.
How much stamp duty attract on my partnership firm deed?
The amount of stamp duty is determined by two factors 1) capital contribution by partners 2) the state in which you are planning to form your partnership firm
What is the legal proof of partnership firm?
A signed and notarized Partnership deed drafted on appropriate value of non-judicial stamp paper is the conclusive evidence of the partnership firm
Can i name my partnership firm whatever i want?
Yes, you can name whatever you want however that business name is not secured under laws from being copied. We advise you to incorporate LLP if you want to protect your business name
Is the liability of the partners limited in partnership firm?
No, In order to discharge the liabilities of the partnership firm all partners are jointly and severally liable to repay all the business liabilities
Do i need to register my partnership firm with state authority?
It is optional to register your partnership firm with state authority. However unregistered partnership firm can do business same as a registered partnership can do. If you really want to register your business under government records it is better to form an LLP to save time & cost and restrict your liability
Do you provide this service in my town?
Yes E-Startup Business is an online platform serving all over India no matters wherever you are doing business all you need is internet connection on your mobile or desktop and we are ready to get your job done
Do I need to physically present for the process?
No, You don’t need to be physically present for the process, E-StartupIndia is an online catering platform all you need is internet connection in your phone/computer and the required documents with you and we can get the job done no matters even if you are present at remotest location of the India
