Partnership is an association of two or more persons to carry on a business in the capacity of co-owners. Each such person is called a partner. All the partners share the profits and losses in proportion of their respective ownership, or as agreed between them. “It is the relation between persons who have agreed to share the profits of a business carried on by all or anyone acting for all”. – Section 4 of Indian Partnership Act, 1932. A Partnership is one of the most important forms of a business organization, where two or more people come together to form a business and divide the profits thereof in an agreed ratio. A Partnership is easy to form, and the compliance is minimal as compared to companies. Registration of partnership firm is optional and at the discretion of the partners. Registration of partnership firm may be done at any time – before starting a business or anytime during the continuation of partnership. It is always advisable to register the firm since a registered firms enjoy special rights which aren’t available to the unregistered firms.
Easy to incorporate
Less Compliance
Quick Decisions
Sharing Of Profits & Losses
Unlimited Liability
Difficult to Raise Funds
Documents Required
Required Documents for Partnership Registration
When forming a partnership, whether registered or not, several documents are necessary:
1. Partnership Deed
While a partnership deed can be verbal, it is advisable to have a written document to prevent future disputes. This deed should be drafted on judicial stamp paper obtained from the relevant State Registrar Office and must be signed by all partners. It outlines the rights and responsibilities of both the firm and its partners.
2. Firm Documents
- PAN Card for the Firm: Partners must apply for a PAN (Permanent Account Number) for the firm by filling out Form 49A online through the NSDL website. If an authorized partner signs the application using a digital signature certificate, it can be submitted online. Otherwise, the application and necessary documents should be sent to the nearest PAN processing center.
- Address Proof of the Firm:If the registered office is rented, you need to provide a rent agreement along with a utility bill (such as an electricity, water, property tax, or gas bill) and a No Objection Certificate (NOC) from the landlord.
3. Documents of Partners
- PAN Card: Each partner must possess a PAN card as it serves as their identity proof. Those without a PAN can apply online via Form 49A on the NSDL website or offline by submitting a downloaded application form along with required documents to a PAN processing center.
- Address Proof: All partners must provide government-issued address proof. Acceptable documents include Voter ID, driving license, Aadhaar card, passport, or utility bills dated within the last two months.
4. Additional Documents for Registration
To register the partnership, partners must submit:
- The partnership deed
- ID and address proofs for both the firm and each partner
- An affidavit confirming that all information in the deed and documents is accurate.
5. GST Registration
To obtain GST registration, firms need to provide:
- PAN number
- Address proof of the firm
- Identity and address proofs of all partners
The authorized signatory must sign the application using either a digital signature certificate or through E-Aadhaar verification.
6. Current Bank Account Opening
To open a current bank account for the firm, you will need to present:
- Partnership deed
- PAN card of the partnership firm
- Address proof of the partnership firm
- Identity proofs of all partners
- Partnership registration certificate (if applicable)
- Any registration document issued by central or state government (typically a GST certificate)
- A recent utility bill (electricity, telephone, or water) dated within three months
- An authorization letter on the firm’s letterhead designating one partner as the authorized signatory for the bank account.
By preparing these documents in advance, you can streamline the partnership registration process and ensure compliance with legal requirements.