Partnership Firm Registration Online in India

What is Partnership Firm?

A partnership firm is a well-recognized business structure formed with mutual consent of all the partners for a profitable purpose. Partnership firm represents a business entity that is formed with a purpose of making a profit from the business. Two or more parties come together with a formal agreement (known as Partnership Deed) to own and manage the business.

Partnership firms are not a separate legal entity while the partners are. A partnership firm cannot be a debtor or creditor and cannot own property. The property, debit or credit of a partnership firm is actually attributed to the partners in the eyes of law.

Choose Partnership because:

1. Partnership registration is very easy.
2. It has minimum compliance requirement.
3. Partnership registration is inexpensive as compared to LLP.

Benefits of Partnership Firm

Why Partnership Registration?

• Audit not required
• Easy to establish
• Relatively inexpensive
• Minimal compliances

Minimum Requirements for Partnership Registration

• No fixed minimum capital requirement
• Minimum 2 partners

Registration Procedure of Partnership Firm

Step 1

Select an appropriate name for the firm.

Step 2

The applicant has to file an application in Form 1 of partnership firm registration.

Step 3

Partnership deed is prepared with the consent of all the partners on stamp paper. Partnership deed includes:

• Capital contribution made by all partners.
• Shares/Interest of all the partners.
• Other clauses made with mutual consent of all the partners.
• Details of the partners and firm such as their name, address, qualification, etc.
• Nature of the firm or business activities involved.
• Circumstances or process that would be followed in case of death or retirement of any designated partner.
• Profit/loss sharing ratio among all the partners.
• Details of loans provided by the partners.
• Rights, duties, salaries, commissions, or payable amount of the partners.

Step 4

Submit all the prerequisite documents along with the partnership deed you have prepared.

Step 5

After submission, verification of documents and issuance of registration certificate.

Advantages and Disadvantages of Partnership Firm Registration

Advantages

• Easy in decision making
• Easy management without any disputes
• Easiest business structure
• Raising funds

Disadvantages

• Abrupt dissolution
• Unlimited liabilities
• Maximum number of members
• Less trustworthy for the general public

Documents Required for Formation of a Partnership Firm

FAQ's

Q1. What is the minimum number of partners required to start a partnership?

Minimum 2 partners and maximum partners can be 200.

Q2. Can NRIs/Foreign nationals be a designated partner in LLP?

Yes, but only after he has been assigned with DIN/DPIN.

Q3. Who are the partners in a partnership firm?

The partners residing in India can only become the partners in a partnership firm.

Q4. How can I apply for the PAN of the partnership firm?

Once the partnership deed is notarized you can apply for the partnership firm PAN.

Q5. What is the capital required to start a partnership firm?

There is no limit on the minimum capital for starting a partnership firm.

Q6. Who will register a partnership firm?

Partnership firms are registered by the Registrar of Firms.

Q7. Is audit required for a partnership firm?

No, it is not required for a partnership firm to prepare audited financial statements each year.

Q8. What is the procedure for registering a partnership firm?

You can register a Partnership firm by following the steps below:

• Visit the Legaltax website.
• Fill up a simple form providing basic information about the proprietor and business to get a Partnership Deed.
• Get this Deed printed on stamp paper of specific value and get it registered with the help of any nearby Advocate/Registrar.

Q9. Which law governs the partnership firm in India?

Indian Partnership Act 1932 governs the partnership firms in India.

Q10. How to do partnership firm online registration?

Please refer to the procedure mentioned in the registration procedure section above.

Q11. What are the minimum requirements for partnership registration?

• No fixed minimum capital requirement
• Minimum 2 partners

Q12. What documents does the Partnership Deed include?

• Capital contribution made by all partners.
• Shares/Interest of all the partners.
• Other clauses made with mutual consent of all the partners.
• Details of the partners and firm such as their name, address, qualification, etc.
• Nature of the firm or business activities involved.
• Circumstances or process that would be followed in case of death or retirement of any designated partner.
• Profit/loss sharing ratio among all the partners.
• Details of loans provided by the partners.
• Rights, duties, salaries, commissions, or payable amount of the partners.

Q13. What are the advantages of partnership firm registration?

• Easy in decision making
• Easy management without any disputes
• Easiest business structure
• Raising funds

Q14. What are the disadvantages of partnership firm registration?

• Abrupt dissolution
• Unlimited liabilities
• Maximum number of members
• Less trustworthy for the general public

Q15. What are the documents required for formation of a partnership firm?

• Partners address proof
• Rent agreement
• PAN card
• Business address proof

Q17. Why Partnership registration?

• Audit not required
• Easy to establish
• Relatively inexpensive
• Minimal compliances

Q18. Why should a Partnership be registered?

• Partnership registration is inexpensive as compared to LLP.
• It has minimum compliance requirement.
• Partnership registration is very easy.

Q19. What is the procedure for partnership registration?

• Complete the partnership form.
• Verification of documents.
• Partnership deed drafting.
• Apply for TAN and PAN.

Q20. What is a Partnership Firm?

A partnership firm is a well-recognized business structure formed with mutual consent of all the partners for a profitable purpose. It represents a business entity formed with the purpose of making a profit. Two or more parties come together with a formal agreement (known as Partnership Deed) to own and manage the business. Partnership firms are not a separate legal entity — the property, debit or credit of a partnership firm is attributed to the partners in the eyes of law.