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Partnership Firm Registration Packages

STANDARD

₹ 3599/- (All Inclusive)
  •  
  • Drafting of deed
  • Execution of deed
  • PAN
  • TAN

ENHANCED

₹ 8599/- (All Inclusive)
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Popular
  • Everything in STANDARD +
  • SSI/MSME Registration
  • Registration with Registrar of Firms

PREMIUM

₹ 19999/- (All Inclusive)
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  • Everything in ENHANCED +
  • GST Registration
  • Trademark (1 application 1 class) (start ups, proprietorship & small business)

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Partnership Firm

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A partnership firm stands as a significant business structure, widely embraced in India for its flexibility and ease of establishment. This form of business organization requires a minimum of two individuals to collaborate and initiate operations. A partnership firm materializes when these individuals pool their resources, skills, and efforts, and subsequently share the generated profits based on a pre-agreed upon ratio. The scope of partnership business encompasses diverse fields such as trade, occupation, and profession.

The legal framework governing partnership firms in India is the Indian Partnership Act of 1932. This legislation intricately regulates the establishment, functioning, and dissolution of partnership firms within the country. Those individuals who join forces to create a partnership firm are referred to as partners. The foundation of a partnership firm is laid upon a formal contract executed among the partners, which is termed a partnership deed. This pivotal document serves as the guiding light for the partnership, delineating the roles, responsibilities, and rights of each partner. Moreover, it delineates the dynamic interplay between partners and the partnership firm itself.

In essence, a partnership firm thrives as a dynamic arrangement wherein individuals collaboratively embark on entrepreneurial endeavors, leveraging their collective strengths for mutual gain. This structure, entrenched in a legal framework, ensures transparency, accountability, and shared success.

Who can apply for Registration

Minimum Partner Requirement

In the context of partnership firms, the fundamental prerequisite is the inclusion of a minimum of two partners. This stipulation underscores the notion that the establishment of a partnership necessitates the collaboration of, at the very least, two individuals. While there exists no definitive upper limit on the number of admissible partners, it's noteworthy that regional statutes or norms could potentially exert influence over the upper threshold. The engagement of multiple partners facilitates the distribution of responsibilities, the amalgamation of diverse skill reservoirs, and a heightened potential for accomplishing shared objectives.

Maximum Partner Limitation

The upper threshold for the number of partners within a partnership firm can fluctuate based on geographical demarcations and local regulatory frameworks. While certain jurisdictions might impose no definitive cap, it is commonplace for partnerships to be circumscribed to a ceiling of 20 partners. To accurately establish the permissible upper echelon of partners for a given partnership firm, meticulous attention must be directed towards the precise statutes and guidelines delineated by the pertinent jurisdiction.

Restriction on Foreign Direct Investment (FDI)

The participation of foreign investors within a partnership firm is explicitly prohibited. Within the ambit of such a business structure, exclusively individuals holding Indian citizenship are eligible to partake as partners and initiate the establishment of the partnership firm.

Distinctive Firm Name

A pivotal requirement in the establishment of a partnership firm mandates that its nomenclature must possess a unique character. It is imperative that the chosen name distinctly sets itself apart and avoids any semblance or resemblance to an already registered or pending trademark.

Flexible Capital Structure

A notable attribute of forming a partnership firm lies in the absence of a stipulated minimum capital threshold. The quantum of capital infused is contingent upon the specific necessities of the business. Furthermore, it is pertinent to acknowledge that the Stamp Duty pertaining to the partnership deed is quantified at 500 rupees.

Voluntary Partnership Deed Registration

While there exists no obligatory mandate for the registration of the partnership deed with the pertinent governmental authority, it is prudent to consider opting for this process. Registering the partnership deed endows it with legal safeguards and reinforces its authenticity.

Detailed Procedure

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Partnership Agreement
Prepare a partnership agreement that outlines the terms and conditions of the partnership, including the name of the partnership, capital contributions, profit-sharing ratio, roles and responsibilities of partners, and other relevant provisions. It is advisable to seek legal assistance in drafting the partnership agreement.
Choose a Name
Select a unique name for your partnership that complies with the naming guidelines set by the Registrar of Firms. The name should not infringe on any existing trademarks or violate any legal restrictions.
Application Form
Obtain the prescribed application form for partnership registration from the Registrar of Firms or online portals. Fill in the required details accurately, including the partnership name, principal place of business, names of partners, and other relevant information.
Documentation
Prepare the necessary documents for partnership registration, which typically include: - Partnership agreement - Application form for registration - Address proof of the principal place of business (e.g., lease agreement, utility bill) - Identity proof and address proof of all partners - Partnership deed on stamp paper (varies based on capital contribution)
Payment of Fees
Pay the requisite registration fees and stamp duty as per the prescribed rates. The fee structure may vary depending on the capital contribution and the partnership agreement.
Submission of Documents
Submit the completed application form, partnership agreement, and supporting documents to the Registrar of Firms or the concerned authority in Hyderabad, Telangana. Ensure that all documents are properly signed and notarized where required.
Verification and Registration
Once the application and documents are submitted, the Registrar of Firms will verify the information provided. Upon successful verification, the partnership will be registered, and a Certificate of Registration will be issued.
Obtain PAN and TAN
After registration, obtain a Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN) for the partnership from the Income Tax Department. These are essential for tax compliance.
Open Bank Account
Open a bank account in the name of the partnership by providing the partnership registration certificate, PAN, and other required documents as per the bank's guidelines.

Documents Checklist

  • Passport size photograph of all Partner
  • Electricity bill of Firm/Company Address. 
  • Personal all Partner Pan Card Copy 
  • Saving bank account statement or canceled cheque (all Partners)
  • A copy of the electricity bill/ Rent agreement 
  • All Partner Aadhar card/voter id/Passport Soft copy

Merits of Registering Partnership Firm

Legal Recognition

Registering a partnership provides legal recognition and establishes the partnership as a separate entity from its partners. This can enhance credibility and instill confidence in business dealings.

Shared Liability

Partnerships often distribute the liabilities and risks among the partners. In a general partnership, partners share unlimited personal liability for the debts and obligations of the partnership. In a limited partnership or LLP, some partners may have limited liability, protecting their personal assets.

Pooling of Resources and Skills

Partnerships allow for the pooling of financial resources, skills, expertise, and experience of multiple partners. This can result in a stronger business foundation, improved decision-making, and increased competitiveness.

Flexibility in Management

Partnerships offer flexibility in management and decision-making. Partners can define their roles, responsibilities, and decision-making processes in the partnership agreement, ensuring efficient operation and utilization of each partner's strengths.

Tax Benefits

Partnerships typically enjoy certain tax benefits. Profits and losses are passed through to the partners, and each partner reports their share of the income on their individual tax returns. This avoids double taxation at the entity level.

Varied Returns for Partners

Partners gain diverse capital and effort-related benefits. Active partners also receive remuneration, interest, and tax-exempted profit shares.

Comparison Chart

Basis of comparison
Pvt. Ltd
Partnership
Proprietorship
LLP
OPC
Ownership
Separate legal entity.
Two or more members
Single individual
Minimum of two designated partners
Sole director
Liability
Limited liability
Unlimited liability
Unlimited liability
Limited liability
Limited liability
Compliance and regulations
Requires compliance with the Companies Act
Fewer compliance requirements
Minimal compliance requirements
Requires compliance with the LLP Act
Fewer compliance requirements
Decision making and control
Decision making is structured
All partners have an equal say in decision making
The proprietor has decision-making authority
The LLP agreement determines decision-making powers.
The sole shareholder has complete control over decision making.
Continuity of the firm
Continuity is not affected
Dissolves upon the death or retirement of any partner
Continuity is a challenge.
Continuity is not affected by changes in partners.
Conversion to a private limited company is required
Taxation
Corporate tax is applicable
Partnerships are not taxed separately
The proprietor is personally taxed
LLP is taxed as a separate entity,
OPC is taxed as a separate entity
Funding and Investment
Easier to raise funds
Partners contribute capital to the partnership.
Funding is primarily limited
Partners contribute capital to the LLP.
Funding is limited to the capital
Conversion and expansion
Can easily be converted
Conversion is complicative
Conversion may require compliance
Can easily be converted
Can be converted on certain criteria
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FAQ's

A partnership is a business structure where two or more individuals or entities come together to carry on a business with a shared goal and mutual understanding.
A partnership can be formed with a minimum of two partners. There is no upper limit on the number of partners, but some jurisdictions may impose certain restrictions.
Partnership registration is not mandatory in all cases. However, registering a partnership offers legal recognition, benefits, and protection, making it advisable in most situations.
The common types of partnerships include general partnership (GP), limited partnership (LP), and limited liability partnership (LLP). Each type has different characteristics and liability arrangements.
Registering a partnership provides legal recognition, enhances credibility, facilitates smooth business operations, enables access to bank accounts and loans, and establishes clear rules and regulations for partners.
In a general partnership, partners have unlimited personal liability for the debts and obligations of the partnership. In a limited partnership or LLP, partners may have limited liability depending on their role and contribution.
Partnerships are typically not taxed at the entity level. Instead, the profits and losses of the partnership flow through to the partners, who report their share of the income on their individual tax returns.
Yes, in many cases, a partnership can be converted into a different business structure such as an LLP, company, or sole proprietorship, subject to compliance with legal requirements and procedures.
The addition or removal of partners is typically governed by the partnership agreement. It may require the consent of existing partners and formal documentation to reflect the changes in the partnership.
Yes, a registered partnership can own property, enter into contracts, and engage in various business activities on behalf of the partnership, subject to the authority and terms outlined in the partnership agreement.
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