Advantages Of Partnership Firm Registration

Advantages Of Partnership Firm Registration:-

The benefits of registering a partnership firm under the Indian Partnership Act are below:

• Partnership firms can be easily registered compared with LLP(Limited Liability Partnership) registration as there is no need for obtaining DIN, DSC etc.
• A partnership firm can prefer to have any name as it does not violate the terms subject to trademark registration.
• A partnership firm does not require to file its annual return with the Registrar each year, unlike a Limited Liability Partnership or Company.

Choosing the Partnership Name:-

The partners can easily choose any name as they require for their partnership firm subject to the following rules:

• Choosing the Partnership Name
• The partners can easily choose their name as they require for their partnership firm subject to the following rules:
• The names must not be too identical or similar to the name of another existing firm doing related business to avoid duplication in the firm names.
• The name must not include words like Crown, Emperor, Empress, Empire or the words indicating the sanction, approval of Government only if the State Government intends its consent in writing to the usage of such words as part of the firm name.

Drafting Partnership Deed:-

A Partnership Deed is an agreement in which the respective terms and conditions of the members of a partnership are stated. The Partnership deed consists of the following characteristics as below:

• Both Partners and Firm name as well as address.
• Business nature to be carried on by partners
• Date of business commencement
• The term of Partnership (whether for a fixed period/project)
• Capital contribution from each partner
• The profit-sharing ratio among the partners

The characteristics mentioned above are the essentials in all partnership deeds. If needed, the partners may also include any additional clauses. Some of the other provisions which can be included in the partnership deed are mentioned below:-

• Interest on Partner’s Capital, Partners’ Loan, and Interest, if any, to be charged on drawings.
• Salaries, Commissions etc., if any, payable to partners
• Method of preparing accounts and arrangement for audit
• Division of task and responsibility, i.e. the duties, powers and obligations of all the partners of the firm.
• Terms and conditions to be followed in case of retirement, death and admission of a partner.

Documents Required

While submitting the application form, submit the following documents:

• Original copy of Partnership Deed, signed by all partners.

• Rental or lease agreement of the property on which the business is set.

• Self-attested proof of Identity of the partners.

• All related documents as per the proposed business activity of the firm.