What is a Partnership firm in India
All the partnership firms are governed by the Indian Partnership Act of 1932. It defines rights, duties, and legal relations of the partners with third parties. It establishes the roles of partners and partnership firms in legal and contractual dealings related to their business.
Partnership firm in India has three important elements - an agreement between two or more people, profit-sharing intent, and joint business operation by one or more person. All these conditions must be met to form a partnership firm.
Benefits of partnership business registration in India
Ease of Formation: Partnership company registration requires fewer legal formalities and easy documentation process.
Adjustable Partnership Terms: You can put terms in the partnership deed as per your need, change profit-sharing ratios. Partnership firms provide you with the opportunity of easy decision-making processes.
Defined Roles and Responsibilities: Clear roles are outlined in the partnership deed of the partnership business registration in India that enhance operational efficiency.
Resource Pooling and Expertise: Combined resources and capital, Shared skills and expertise, Enhanced business foundation.
Shared Liability: Distribution of risks and liabilities, Reduced individual burden.
Tax Benefits: Individual tax treatment for partners, potentially favorable tax rates.
Confidentiality: In partnership firm in India, Lesser legal requirements for disclosure, enhanced privacy and confidentiality.
Partner's Share Exemption: The partner’s share of the firm income is exempted.
Who Can Become a Partner in Partnership Firm in India?
There are certain conditions that need to be met to be a partner in a partnership firm.
Sound Mental Health: One must be in good mental health and an adult. Moreover, anyone who wants to be a partner in a partnership firm must not be legally barred from entering into any kind of contracts.
Registered Partnership Firms: Any registered partnership firm in India is eligible to be a partner in a partnership firm.
Head of a Hindu Undivided Family: A head of a Hindu Undivided Family (HUF) can become a partner in the partnership firm.
Companies: Companies have the status of a legal entity, so any company can get a partnership right in a partnership firm.
Trustees of Certain Trusts: Trustees of any religious organisation, or family can be a partner in the partnership firm.
Documents Required for partnership company registration in India
PAN Card and Aadhar Card of all the Partners
Passport size Photo of the partners
Registered office details also need to be furnished
Proof of Address has to be submitted.
NOC from the Property Owner of the Office
Rent Agreement/Receipt of Property Tax
Partnership Deed
An application for registration of the partnership firm
Procedure for partnership company registration in India
Documentation: Collect all KYC documents of the partners, address proof of the office of firm, and the rental agreement (if required).
Select a Unique Name: Select a unique and relevant name for your partnership firm.
Partnership Deed: Prepare a draft for the partnership deed on a stamp paper and it must be notarized and duly signed by all the partners.
PAN and TAN: Obtain PAN and TAN for income tax and TDS compliance to partnership company registration in India.
GST Registration: Register for GST to meet tax obligations. Obtain a unique GSTIN for future GST-related activities. Moreover, register your partnership firm with the Registrar of Firms (ROF) in your state either online or offline.
Proprietorship Registration
