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Partnership Registration
Partnership Registration
Formalize your business relationship with Partnership Registration. Taxyaari provides comprehensive support to set up a partnership firm, offering clarity in roles, responsibilities, and profit-sharing, making it easier to manage and grow your business. For more details on the service and the processes involved, please refer to the FAQs below.
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FAQs
What is a Partnership Firm?
A partnership firm is an unincorporated business entity that can be formed by two or more persons. The partnership is governed by the Partnership Act, 1932, which defines the rights and obligations of partners and the rules for the functioning of the partnership. In a partnership firm, the partners share the profits and losses of the business and the liability of each partner is
unlimited.
What are the Benefits of the Partnership firm?
• Easy formation: Partnership firm can be easily formed with minimum legal formalities.
• Shared liability: All partners in the firm share the liability of the business.
• Flexibility: Partnership firms are flexible in terms of the distribution of profits, management of the business, and decision making.
• Fewer compliance requirements: Partnership firms have fewer compliance requirements as compared to other forms of businesses.
What are the Demerits of forming a Partnership Firm?
• Unlimited liability: Each partner in the partnership firm has unlimited liability, which means that their personal assets can be used to pay off business debts.
• Limited capital: The capital of the partnership firm is limited to the contribution made by the partners.
• Lack of perpetual existence: Partnership firms do not have perpetual existence and are dissolved when one of the partners dies or leaves the firm.
What is the Time Required for Formation of a partnership firm?
The time required for the formation of a partnership firm is approximately 7-9 working days, subject to the availability of necessary documents.
What is the Income Tax Rate on Income and Income Distribution by the Partnership firm?
Partnership firms are subject to a tax rate of 30%, in addition to the applicable surcharge and health and education cess.
What are the Documents Required for Registration of the Partnership firm?
Partnership deed, PAN card of all partners, ID proof and address proof of all partners, Address proof of the partnership firm's
registered office, Partnership registration application form.
Authors Remark:
A partnership firm is a suitable business structure for small and medium-sized businesses where partners can share their skills,
capital, and risk. However, it has its limitations, such as unlimited liability and limited capital. It is essential to carefully consider all the pros and cons of a partnership firm before deciding to form one.