A Partnership Firm refers to an entity formed by two or more people who mutually agree to divide profits / loss in a predetermined ratio.

In India, the primary law governing partnership registration is the Indian Partnership Registration Act of 1932.

The partnership deed is a legal document used to establish the Partnership Firm Registration.

According to law, a partnership is an agreement between individuals who have consented to divide profits earned from the business operation performed within the partnership firm. A partnership firm can have a maximum of 50 members.

It is crucial to note that members of a Hindu Undivided Family or a Burmese Buddhist member cannot be part of a partnership firm.

Read more about Partnership Firm Rule and Regulation at The Partnership Act, 1932 

The complete process takes about 7 working days, including the approval of the DIN, company name, and company incorporation. However, creating a company is now a quick process, which allows all paperwork to be loaded into a single online platform. Our experts will help you through every step of the online company registration process.

Step 1

CHOOSE A NAME FOR YOUR PARTNERSHIP FIRM

You can choose any name for your partnership firm, as long as it follows the rules set by the Registrar of Firms.

Ensure that the name you choose is unique and not already taken by another firm. Also, avoid using any names related to the government or any other prohibited names.

Step 2

DECIDE PARTNER PROFIT SHARING RATIO, FIRM ADDRESS, AND OTHER TERMS OF PARTNERS

Partners have to decide their profit and loss sharing ratio, address of firm from where business shall be operating, investment, duties and responsibilities of each partner, terms of entering new partner or exiting old partner and other relevant terms which mutually agreed upon among all partners.

Step 3

DRAFT PARTNERSHIP DEED AS PER THE PARTNERSHIP ACT 1932

You need to hire a professional expert to draft a partnership deed as per the provision of the Partnership Act, 1932. A Professional will assist you in buying appropriate value of stamp paper, deed printing, obtain signature of all partners in deed, do attestation work and apply for partnership firm registration.

Step 4

YOU SHOULD SUBMIT AN APPLICATION TO REGISTER YOUR PARTNERSHIP FIRM

To register your partnership firm, you need to submit an application form along with the required fees to the Registrar of Firms in the state where your firm is located. The partnership registration application must be signed and verified by all partners or their representatives.

Step 5

OBTAIN YOUR REGISTRATION CERTIFICATE

Once the Registrar of Firms approves your registration application and supporting documents, your firm will be registered in the Register of Firms, and you will be given a Registration Certificate. The Register of Firms maintains the latest information of all registered firms, which can be accessed by anyone for a fee.

Advantages of Partnership Firm Registration

# MINIMUM COMPLIANCE

One of the most significant advantages of partnership formation is that it involves minimal compliance work. Compliance can be a burden for many small businesses, particularly those that are just starting out. However, when you form a partnership, you can avoid much of this hassle. Unlike private limited companies, partnerships are not required to comply with as many legal and regulatory requirements. This means that you can focus on running your business rather than dealing with compliance work.

# SIMPLE TO DO PARTNERSHIP FORMATION

Partnership Firm is one of the simplest types of businesses to launch. In most cases, all you need is a partnership deed through partnership formation registration, which is relatively easy to obtain. This means that you can establish a partnership quickly and with minimal fuss. On the other hand, registering an LLP can take several days to complete, and you may need to go through a lengthy process of obtaining various approvals and signatures from the MCA.

# COMPARATIVELY ECONOMICAL

Another advantage of partnership formation is that it is comparatively economical. When you form a private limited company, you will need to pay several fees, including incorporation fees, compliance fees, and auditor fees. These fees can add up quickly, particularly if you're just starting out. However, forming a partnership is much cheaper. In most cases, all you need to pay is the cost of partnership deed registration, which is typically much lower than the fees associated with forming a private limited company.

In conclusion, forming a partnership could be an excellent option for small businesses in India. With minimal compliance work, a straightforward registration process, and comparatively low costs, partnerships can offer a range of benefits for entrepreneurs looking to start a new venture.

Documents Required for Partnership Firm Registration

#1. Photo, Aadhar & PAN of all Partners

#2. Address of Proposed Firm

#3. Form No. 1 (Application for registration under the Partnership Act).

#4. Original copy of Partnership Deed, signed by all partners.

#5. Affidavit declaring the intention to become a partner.