PARTNERSHIP FIRM

Partnership Company registration in India is an agreement between two or more people to conduct business operations together. In this type of partnership, profits and liabilities are shared among members in an agreed ratio.

In India, the operation of partnership firms is governed by the Indian Partnership Act of 1932. Those who unite to create a partnership firm are referred to as partners, and the formation of the partnership firm is based on a contractual agreement among these individuals.  The agreement among partners is commonly referred to as a “partnership deed.

Documents required for partnership registration

  • PAN card of firm
  • Current Bank Account details
  • Partnership Deed
  • Rent agreement, if rented premises
  • NOC from landlord
  • Electricity bill/ Sale deed if owned premises
  • PAN & Aadhar Card of Partners
  • Photographs and DSC of partners

 

Benefits Of Partnership Firm

A partnership firm offers several benefits, making it an attractive business structure for many entrepreneurs. Here are some key advantages:

  1. Ease of Formation: Partnership firms are relatively easy and cost-effective to establish, involving fewer formalities compared to other business structures.
  2. Financial burden Distribution: Partners share the financial responsibilities, risks, burden and profits among themselves making it more manageable for each individual.
  3. Tax Benefits:  Partnership firms are taxed as pass-through entities, which means that the profits of the business are passed on to the partners and taxed at their individual tax rates. This can be a tax advantage for partners who are in a lower tax bracket than the business
  4. Shared responsibility and decision-making: Partners share the responsibility of running the business and making decisions. This can be a great advantage, as it allows partners to draw on each other’s strengths and expertise.
  5. Capital Contribution: Partners can contribute capital, and additional partners can be added to raise more funds for the business.

POST REGISTRATION COMPLIANCESTop of Form

Once a partnership is registered, the business needs to comply with legal, financial, and operational requirements. Below is the process after registration of partnership

 

  1. PAN: Apply for Partnership PAN card with Income tax Department
  2. Bank account: Open a Partnership Bank Account which will help manage the business’s finances and ensures transparency.
  3. Register for GST: If the turnover exceeds the prescribed limit while dealing in goods and services, partnership need to register for GST
  4. FSSAI License (if food business): If the partnership involves food processing or trading, the Food Safety and Standards Authority of India (FSSAI) license is required.
  5. Import/Export License: If the partnership engages in import/export, you must obtain an IEC (Import Export Code)
  6. BRN Registration: BRN registration is important as it gives an entity a unique identity. It is a 16- digit number