A partnership agreement is a necessity if you’re opening a business with another person. The agreement serves two purposes: it creates a legal document that provides for the rights and responsibilities of each partner and it provides you with legal recognition from the state, allowing you to do business.
1. Create a partnership agreement.
In general, the partnership agreement should contain the full legal name of each partner, the name of the business, percentage of capital each partner is contributing, profit/loss percentage, how new partners will be admitted and how the partnership can be terminated.
2. Take the partnership agreement you drafted and have it notarized.
This means that each partner will need to sign the form in the presence of the notary public.
3. Take the partnership agreement and the partnership form to your Registrar of Firms.
You can usually submit the form in Registrar of Firms.
4. Pay the required filing fee at the time you submit your partnership form.
This can usually be paid by check, credit card or money order. As with all things, however, check with your state before submitting payment, as not all states accept all forms of payment.
Partnership need to be Registered or Notary will work?
Indian Partnership Act, 1932 Section 18 states that a partner is an agent for doing the business of the firm and the partnership firm will not be treated as legal entity. Hence, a firm which has entered into notarized partnership deed have no legal status for any proceedings. A notarized partnership firm cannot sue another party in case of any dispute.
Hence it is suggested to Register a Partnership firm.
If however there is uncertainty of the life of the partnership in the short run then it is recommended to not to register the partnership and start the work with Notarized partnership. However when the things get streamlined it should get itself registered.
(However cost of Registrations almost equals cost of incorporating a Private Limited / LLP / One Person Company)
Steps to Notarized Partnership Firm
– Follow Steps 1 and 2 above
– Apply for PAN
– Apply for GST (If required)
– Apply for MSME (If required)
– Start your Business
Steps to Registered Partnership Firm
– Follow Steps 1 to 4 above
– Apply for PAN
– Apply for GST (If required)
– Apply for MSME (If required)
– Start your Business
Other Documents Required for Partnership firm Registration
– Partnership Deed
– Documents of Partners- Pan, ID Proof, Passport size photo
– Documents of Firm- Address proof: Electricity Bill/ Water Bill/ Property Tax receipt/ Gas Bill + Rent Agreement & NOC (if rented)
You may contact the author for further information at 9899595719 or taxwizersconsultant@gmail.com
Disclaimer: The above article is only for information purpose and is on based on the author’s interpretation of the relevant provision. The same should not be considered as professional advice.
Author Bio
we have notarized partnership deed we want Registered Partnership