Partnership Firm Registration
For partners
For small and medium enterprises
Simple & Secure Online Process
Dedicated Professional
Hassle-Free Process
Get your work done in 7-10 days
Introduction of Partnership Firm Registration
A partnership is a form of business where two or more people share ownership, as well as the responsibility for managing the company and the income or losses the business generates. The Partnership firms are easy to form and have less legal compliances. The partnership firms can be registered or unregistered and it is regulated under Indian Partnership Act, 1932. The Partnership Deed is the most essential document which decides the overall working and dissolution process. It is very important to draft the deed with full expertise so that conflicts do not arise between the partners in future.
The Act does not bind the partners to get the firm registered but comes with some drawbacks for the partners such as they cannot file or institute any cases against the partners and third parties. Therefore it is recommended to get the partnership firms registered. The State Department deals with the registration process and every state has different platforms and guidelines to submit the documents.
Compliance Sagar ensures you the high level of satisfaction and timely delivery of Partnership Registration and better dealing with the requirement of government through its expert professionals. You may get in touch with our team on +91 90797 59095 or email cssunil93@gmail.com for Partnership Firm Registration.
Advantages of Partnership Firm Registration
Easy to Start
Partnership firms are one of the easiest modes to start. The only requirement for starting a partnership firm in most cases is a partnership deed. Hence, a partnership firm can be started on the same day.
Faster Decision making
Decision making in a partnership firm could be faster as there is no concept of the passing of resolutions.
Raising of Funds
When compared to a proprietorship firm, a partnership firm can easily raise funds. Multiple partners can come forward for more feasible contributions.
Sense of Ownership
Every partner owns and manages the activities of their firm. Ownership creates a higher sense of accountability, which paves the way for a diligent workforce.
Firm can file legal case
If partnership firm is registered under partnership Act it has authority to file any legal case against the third party
Less Compliance
The Partnership firm has minimal requirements of completing the compliance as compared to LLP
Procedure of Registration of Partnership Firm
Document Required for Partnership Firm Registration
Pan card of partners as proof of identity
Aadhar Card of partners as proof of identity
Photograph of Partners
Business Address Proof Owned Property : Electricity bill and Sale deed in case one of the Partner owns the place of business
Business Address Proof Rented Property : Electricity bill and Rent/lease agreement
Stamp Paper as per the State
Note:- In case of NRI or Foreign National documents of Directors and Subscribers must be notarized or apostillled.
More Insights on Partnership Firm Registration
Minimum and maximum partners
The partnership act does not prescribe the criteria of minimum and maximum partners. But as per the Companies (Miscellaneous) Rules, 2014 the minimum number of partners should be at least 2 and maximum number of members in a partnership firm is 50. The. The maximum number of members for a firm carrying banking business is 20.
Partnership with no capital
Legally no minimum capital prescribed. So, to start a Partnership firm, you need to plan the future expenses and raise capital accordingly. However, any amount capital could be introduced in the form of Partners Contribution and the same shall be mentioned in the Partnership deed, as executed between the Partners.
Partnership Firms Tax Rate
Partnership firms are liable to pay income tax at the rate of 30% of total income. In addition to the income tax, a partnership firm is also liable to pay income tax surcharge on the amount of income tax at the rate of 12%, when total income exceeds Rs.1 crores. In addition to the income tax and surcharge, a partnership firm must pay education cess and secondary higher education cess.
Disadvantages of not registering Partnership Firm
Difference between LLP and Partnership Firm
| Basis | Limited Liability Partnership | Partnership Firm |
|---|---|---|
| Registration Requirement | It is mandatory to get the entity registered under LLP Act, 2008 | It can be registered as well as unregistered |
| Number of members | Partners can be unlimited | 2 -50 partners |
| Number of Director | 2 designated partners | NA |
| Naming of Entity | The name should be unique and no trademark should exist on the name. The name should end with LLP. | There are no naming guidelines. |
| Capital Requirement | No minimum capital requirement | No minimum capital requirement |
| Liability of Entities | Limited Liability | Unlimited Liability |
| Foreign Investment | LLP is eligible to accept Foreign Direct Investment in accordance with the RBI norms. | Not Allowed |
| Statutory Audit | Audit is compulsory if the contribution more than Rs. 25 lakhs or turnover exceeds Rs. 40 Lakhs | It is not required but tax audit is applicable on the basis of turnover as prescribed under IT Act. |
| Compliance Level | LLP has to file annual returns and statements every year. | The compliances are very less and have to just file ITR of the partnership firm. |
| Tax Rate | Tax Applicable : 30% | Tax Applicable : 30% |
| Know More | Get Started |