A partnership firm is a mode of doing business by forming an entity which is owned, controlled and runned by two or more people together who contribute to capital of such firm. Partnership firm is one of the most popular type of entity for doing business in india and is best suited for small business setup as it has least compliance to be complied with.
There is no mandatory requirement to register partnership firm and hence a partnership firm may be register or unregister however it is advisable to register the partnership firm as it give right to partner to sue outside parties or their own partner in case any breach of contract under Partnership Act, 1932.
The average time to complete process for sole proprietorship registration is 5 – 7 days. A Partnership firm may use a trade name or business name. They may also apply for trade mark for name being used for doing business.
Benefits of Partnership Firm registration
- Easy to establish
- Lesser statutory compliances
- Full control of partners
- Complete partners control
- Easy to close/windup
Process for Partnership firm registration
Partnership firm may or may not be registered as it’s not mandatory under Partnership Act, 1932 to register the firm however it’s advisable to register your partnership firm as it give right to partnership firm to sue other party in case of any breach of contract and give partner to sue other partner in case of any breach. Further following will be steps involved in forming Partnership firm: –
- Finalizing name of Partnership firm
- Making partnership Deed and getting same signed and stamped and notary
- Applying to Registrar of firm for registration of partnership deed
- Getting certificate of registration
- Getting PAN and TAN of Firm
- Getting Bank account open
- Getting GST registration (if turnover more than 20 lakhs)
Documents required for Partnership firm registration
- Signed, Stamped and notorized Partnership deed
- ID and address proof of partner (PAN and Aadhaar card)
- Address proof of place of business (Electricity bill and ownership proof)