Partnership Firm

Partnership Firm Registration

A General Partnership is a business structure in which two or more individuals manage and operate a business in accordance with the terms and objectives set out in the Partnership Deed. This form of business registration is best suited for those business looking to manage business within their limited reach and without much legal burdens.

The Incorporation Process For Partnership Firm Are As Follows:

You need to have the following set of documents before proceeding for registration:

  • Self attested PAN card copy of proposed  Partners
  • Self attested Address Proof of Proposed  Partners (Passport or Driving Licence or Voters ID or Aadhar Card)
  • Address proof of the proposed Registered Office  (electricity bill or property tax receipt and Rental Agreement and It can be a residential property)
  • No Objection (NOC) from the person who owns the property mentioned above (we will prepare)
  • 2 passport size photos of proposed  Partners
  • Main objects
  • Partnership Firm name
  • Capital and shareholding pattern

Its hard to digest all if it is at one stretch. So an introduction about a business or start up formation options is vital for deciding the right form of business registration. The Companies Act, 2013 and Limited Liability Partnership Act, 2008 have brought more business formation choices for entrepreneurs. The key factors that influence the legal form of a business are nature of your business, customer’s profile (corporate, small businesses or individuals ), expected business turnover, scalability  of your business idea and future funding prospectus.

 

Every entrepreneur/promoter should take the pain to know about the pros and cons of these legal forms.

 

Formation

Do I need a Registration?

What type of business names can I keep?

How risky is it for me?

To what extent is each member of the business liable?

Tell me the minimum membership limit.

Is foreign ownership allowed?

How much will I get taxed?

What are my annual tax filing norms?

Is Annual Audit Required?

Can I convert my business into any other legal form??

Compulsory Conversion to Private Limited Company Applicable?

Partnership

Yes. Register with Registration of Firms

Firm can use any name that he likes, but avoiding names already trademarked is advisable.

Partners will stand liable for the liabilities of the business.

Unlimited liability.

2 People

No

Profits get taxed at 30% plus cess and surcharge is applicable if profit exceeds 1 Cr.

Only Income Tax must be filed for the income of firm and partners.

Only income tax audit is applicable if the turnover exceeds limit of 2 Cr

Yes, Partnership can be converted into a Private Limited Company or LLP.

NO

Private Limited Company

Yes, Ministry of Corporate Affairs registers Private limited company under the Companies Act, 2013

Firstly, submit a set of names to Registrar of Companies, wait for approval from Registrar. Best practice is that the names submitted must be inoffensive, legal and not similar to any registered LLP’s or companies

Private Limited Company is a separate legal person in the eyes of law, registered under Companies Act 2013. So, the shareholders are not responsible for business liabilities.

Liability is limited to his/her share capital contribution.

2 People

Yes

Profits get taxed at 25% plus cess and surcharge is applicable if profit exceeds 1 Cr.

Every financial year Private Limited Company must file Annual Accounts and Annual Return with the Registrar of Companies. Plus, Income Tax must be filed separately.

Statutory audit is to be conducted irrespective of business transaction and turnover. Income tax audit is applicable if turnover exceeds 2 Crs

Yes, Private Limited Company can be converted into a Public Company or LLP. Even, Public Limited Company can be converted into a Private Limited Company.

NO

Limited Liability Partnership

Ministry of Corporate Affairs registers an LLP business under the Limited Liability Partnership Act, 2008.

Firstly, submit a set of names to Registrar of Companies, wait for approval from Registrar. Best practice is that the names submitted must be inoffensive, legal and not similar to any registered LLP’s or companies.

“LLP” is a separate legal person in the eyes of law, registered under LLP Act 2008. So, the partners are not responsible for business’ liabilities.

Liable to the extent of their contribution (in money, in kind or in services extended) to the LLP.

2 People

Yes

Profits get taxed at 30% plus cess and surcharge is applicable if profit exceeds 1 Cr.

Every financial year Annual Statement of Accounts & Solvency and Annual Return with the Registrar.Plus, Income Tax must be filed separately.

Statutory audit is to be conducted if partners contribution exceeds 25 lakhs or turnover exceeds 40 lakhs. Income tax audit is applicable if turnover exceeds 2 Crs

Yes, Private Limited Company can be converted into a Public Company or LLP. Even, Public Limited Company can be converted into a Private Limited Company.

NO

One Person Company (OPC)

Yes, Ministry of Corporate Affairs registers One Person Companies under the Companies Act, 2013

Firstly, submit a set of names to Registrar of Companies, wait for approval from Registrar. Best practice is that the names submitted must be inoffensive, legal and not similar to any registered LLP’s or companies

OPC is a separate legal person in the eyes of law. So, the share holder is not responsible for business liabilities.

Liability is limited to his/her share capital contribution.

1 People

NA

Profits get taxed at 25% plus cess and surcharge is applicable if profit exceeds 1 Cr.

Every financial year OPC must file Annual Accounts and Annual Return with the Registrar of Companies. Plus, Income Tax must be filed separately.

Statutory audit is to be conducted irrespective of business transaction and turnover. Income tax audit is applicable if turnover exceeds 2 Crs

OPC could be converted into any legal form. But, it depends on the number of promoters, business operations, funding requirements and other factors. Limited Liability Partnership or Private Company is preferred by promoters when seeking expansion of their OPC

NO

Sole Proprietorship

No legal requirement to do-so.

Promoter can use any name that he likes, but avoiding names already trademarked is advisable.

Promoter will stand liable for the liabilities of the business. Because the business is not considered as a separate legal person/entity.

Unlimited liability.

1 People

NA

Individual income tax slab of proprietor is the basis of taxation.

Only Income Tax must be filed on the basis on proprietor’s income.

Only income tax audit is applicable if the turnover exceeds limit of 2 Cr

NO

Yes. If turnover exceeds 2 cr

WHY NURTURELABZ

Startup Friendly

Individual attention and single point of contact help us register 1000 plus businesses and its counting.

Satisfied Clients

We strive to achieve total client satisfaction by delivering quality services in professional and time bound manner

Never Miss Deadline Approach

We are committed to meet deadline there by saving your money getting wasted by paying penalties.