As the relationship of partners among themselves depends on the drafting of partnership deed, setindiabiz stands as the most preferred brand for registration of partnership business in India. We have helped 1000+ firms to start and register with the registrar of firms. You may start your business immediately and within 1 day as a partnership firm.
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To start a Partnership firm, partners need to enter into an agreement which is popularly known as Partnership Deed. Different states impose different stamp duty on the partnership agreements/deeds, it means while creating a partnership instrument (Deed) the partners must purchase stamp paper of appropriate value as may be applicable in the respective state, to be annexed with the agreement. An agreement can further be notarized. Though registration of partnership Firm is not mandatory under The Partnership Act, 1932, however, section 69 of the act specifies the effect of Non-Registration, according to that an unregistered firm shall not be able to recover any sum more than Rs. 100. Hence, it is strongly recommended to register the partnership firm with the registrar of firms (ROF)
Two person is needed to become partners of the firm. However, maximum 20 partners are allowed in a firm (10 in banking business)
No minimum capital is prescribed, it must be based on the business requirements. The Stamp Duty on the deed is based on the capital of the firm.
Foreign investment in a partnership firm is not permitted. In the firm, only Indian citizen can become the partner and start the partnership firm.
Name of the firm should be unique, and it must not be same or similar to the name of any existing trademark which is registered or applied.
The name of the partnership firm should be cross-checked with the trademark registry to avoid any infringement of someone else Trademark or brand name
The Partnership Agreement is the constitution of the firm which determines the relationship of partners among themselves as well as the relation of partners vis a vis firm.
A Partnership Deed must be well drafted, and the signature of the partners be made on the agreement in the presence of witnesses before a Notary Public.
To register a partnership firm, the deed along with KYC of partners and premises where the registered office is situated is filed with the Registrar of Firms.
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We have prepared a detailed and easy to understand comparative table showing availability of features and advantages of one form of business to that of others. The same can be found at the end of this page. Click here to go there.
To start a partnership firm, the minimum number of partners is two, whereas the maximum number of partners can be 20. The partners must come together to carry on any legal business with the motive of earning profits.
The partnership business is regulated under Indian Partnership Act, 1932. Which prescribes possibility of two types of the firm, unregistered firm, and registered firm. An unregistered firm is formed by entering into an agreement between two competent persons, known as partners, where the firm is not registered with the registrar of firms. Whereas the firms which subsequently get registered with the registrar of firms by submitting the copy of partnership deed and KYC of partners and the registered office is known as the Registered Partnership Firm.
Though the Indian Partnership Act, 1932 does not make registration of partnership mandatory, section 69 places certain disadvantages to an unregistered firm. Following are the disadvantages of an unregistered firm.
Hence, we strongly advise registering the partnership firm. An unregistered firm can be registered at any time. Every state government has established the office of the registrar of firms, which is vested with the powers to register the firm and issue the Certificate of Registration of the Firm and a copy of the extracts of the register of firms where the partnership name has been entered.
The application for registration of partnership firm is filed with the Registrar of Firms having jurisdiction over the place of business of the partnership firm. The registrar of firms after receipt of the application complete in all aspects with all required documents registers the firm within 1-2 weeks and issues the Certificate of Registration of Firm.
The law does not provide any specific format for the partnership deed, it is up to the partners what they agree and reduces in writing at the time of starting their partnership firm. The partnership once entered can be changed any number of times. However, each amendment of the deed must be filed with the registrar for its registration. Below is the list of items which should form part of the agreement.
The stamp duty on the partnership deed varies from state to state, and within one state it further varies based on the capital of the firm. You must correctly consider the applicable stamp duty on the partnership deed. The notary of the deed is an essential requirement for partnership registration.
The PAN is a ten-digit alphanumeric number allotted by the Income Tax Department, the application for pan card is filed in Form No 49A. The TAN is a number allotted for TDS Compliance, the application for TAN is filed in Form No 49B. Normally it takes around 6-10 days in PAN allotment and Pan Card Delivery.
Yes, a partnership firm can be converted easily into a Limited Liability Partnership or a Private Limited Company. The partnership is an old method of doing business; we always recommend to start a business in the Private Limited form
A partnership business begins with the creation of an agreement by the partners. As the registration is not mandatory, the business can start on the same day of agreement of the partners. However, the Notarization of the agreement or its registration with the registrar of documents may be taken up later on. Similarly, the registration of firm with the registrar of firms can also be taken up in due course of time. Hence it can be rightly said that it's comparatively easy to start a partnership.
A Partnership is started by its partners with a separate name in the deed, which is known as the name of the firm. While deciding a name, the care should be exercised to check if it conflicts with some one's else trademark. Our specialists shall be providing you with free consultancy on Name Check and how to protect Business Name, its Logo, Punchline, etc.
Unlike Limited Company or LLP, there is no need to file the annual return for a partnership firm. However, income Tax Return shall be necessary to be submitted at the end of the financial year and within Due Date of filing. There is no provision of audit under the partnership, Act hence a firm does not require to get its books audited. However, if the turnover crosses 2 Crore, then tax audit is mandatory.
Under partnership form of business, there is no separation of ownership and control. The partners act in confidence to each other and act of one partner is binding on another. Partners monitor and manage the firm without any interference. The decision making in case of a firm is relatively a fast process in comparison to that of the Private Limited company, Limited Liability Partnership (LLP)
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