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Features of Partnership
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Agreement: A partnership is formed through an agreement, either written or oral, between two or more individuals.
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Number of Partners: A partnership must have at least two partners, with the maximum limit varying by country.
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Mutual Agency: Each partner acts as an agent for the firm and other partners, with the authority to make binding decisions on behalf of the partnership.
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Profit Sharing: Partners agree to share profits and losses according to the partnership agreement.
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Joint Ownership: Partners jointly own the business and its assets, holding them in common.
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Unlimited Liability: Generally, partners have unlimited personal liability for the partnership's debts.
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Common Goal: Partnerships are formed for the common purpose of earning profits.
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Flexible Management: There is no statutory structure for managing a partnership; partners manage the firm as agreed.
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No Separate Legal Entity: The partnership firm is not a separate legal entity from its partners (in most jurisdictions).
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Shared Risk: Partners share risks, with losses and liabilities affecting all partners.
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Mutual Trust: Partnership relies on trust and confidence among partners for decision-making.
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Continuity: Partnerships can be dissolved by agreement, bankruptcy, death, or insolvency of a partner.
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Capital Contribution: Partners contribute capital based on the partnership agreement, which can be monetary or non-monetary.
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Limited Lifespan: Partnerships typically lack perpetual succession and may dissolve upon certain events affecting the partners.
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Legal Formalities: Generally, fewer legal formalities are required compared to corporations, although registration may be needed.
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Decision-Making Power: Decisions are typically made collectively, often requiring consensus or majority votes.
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Transferability: A partner’s interest is not easily transferable; consent of other partners is usually required.
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No Double Taxation: Partnerships are usually taxed once, at the individual partner level, avoiding double taxation.
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Diverse Skills: Partnerships benefit from a diverse set of skills, knowledge, and resources from each partner.
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Profit and Loss Sharing Ratio: The agreement specifies how profits and losses are divided among the partners, which can be equal or vary based on the terms.
Why Choose Private Limited Company
Advantages
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Collaboration Tax advantages Simple operating structure Flexibility Acquisition of capital
Disadvantages
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Conflict with partners Authority of partners Unlimited liability Vulnerability to death or departure Limitations on transfer of ownership
Who is Eligible?
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Indian Citizen:
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Only Indian citizens are eligible to register a sole proprietorship.
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Age Requirement:
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The proprietor must be at least 18 years old.
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Resident of India:
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The individual must be a resident of India.
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Single Ownership:
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Only one person can own and control the business.
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Valid Identity Proof:
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The proprietor must have a PAN card, Aadhaar card, and valid address proof.
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Business Type:
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Suitable for small and medium-sized businesses engaged in trading, manufacturing, or services.
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Document Required
📌 1. For the Proprietor
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PAN Card – Mandatory for tax registration.
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Aadhaar Card – For identity verification.
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Address Proof (any one):
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Voter ID
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Driving License
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Passport
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Latest Bank Statement / Utility Bill (not older than 2 months) – For address verification.
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Passport-size Photograph – Recent colored photo of the proprietor.
🏢 2. For Business Address Proof
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Electricity Bill / Water Bill / Gas Bill – As address proof (not older than 2 months).
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Rent Agreement / Sale Deed –
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Rent Agreement if the property is rented.
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Sale Deed if the property is owned.
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No Objection Certificate (NOC) – From the property owner, allowing the use of the address for business purposes.
💡 3. Additional Documents (If Applicable)
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GST Registration Certificate – If turnover exceeds ₹20 lakh (services) or ₹40 lakh (goods).
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Udyam/MSME Registration Certificate – For government benefits.
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Shop & Establishment License – If you have a physical store or office.
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Current Bank Account Details – For business transactions.
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ITR (Income Tax Returns) – If applicable, to show financial history.
Step 1 :
Check the eligibility and documentation
Step 2 :
Request DSCs and DINs for each director
Step 3 :
Submit a request for a name reservation Form Spice+ for company incorporation
Step 4 :
Apply for PAN and TAN for your new business
Step 5 :
ROC issues an incorporation certificate with a PAN and TAN
Step 6 :
Open a bank account and start your business.
Steps in Registering a Private Limited Company
Why ComplyHub for Partnership Registration
We provide access to top incorporation experts who will guide you through the complexities of sole proprietorship registration. Our professionals will coordinate with you to fulfil all your legal requirements. You can also track the progress on our online platform at all times. Our team will handle all the paperwork and ensure a seamless, interactive process with the government. We provide clarity on the incorporation process to set realistic expectations. With a team of over 300 experienced business advisors and legal professionals, you are just a phone call away from the best in legal services.
