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How to register a partnership firm in India?

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How to register a partnership firm in India?

A company structure known as a partnership firm is one in which two or more persons join forces to operate a business with the intention of turning a profit. Indian partnership firms are governed under the Indian Partnership Act, 1932. Small and medium enterprises frequently choose this company structure since it is simple to start up and run.

It is crucial to register a partnership firm since it gives the company legal status. Additionally, it makes sure that the partners are aware of the partnership’s conditions and are accountable for the firm’s debts and responsibilities. It also permits the business to create a bank account, get different licenses and registrations, and take advantage of government programs.

Key Takeaways

  • A company structure known as a partnership firm is one in which two or more persons join forces to operate a business with the intention of turning a profit.
  • Partnership Firm Registration FormIn India, there is no particular form for registering a partnership firm.
  • A Certificate of Registration will be given to the partnership company provided everything is in order.
  • Post-Registration Requirements Open a Bank AccountThe partnership company should create a bank account in its name after receiving the Certificate of Registration and supply all the required documents, including the Certificate of Registration, Partnership Deed, and KYC records for each partner.
  • Apply for GST RegistrationIf the partnership firm’s yearly turnover surpasses a specific level, they must submit an application for GST registration.

Requirements for Registering a Partnership Firm

Minimum and maximum number of partners

There must be a minimum of two partners and a maximum of twenty partners in order to form a partnership firm in India. According to the guidelines of the Institute of Chartered Accountants of India, the maximum number of partners is nonetheless limited to 10 if the partnership business does chartered accounting.

Selection of a business name

The name you choose for the business should be distinctive, simple to recall, and accurately describe what your company does. The name shouldn’t be offensive or provocative, and it shouldn’t infringe on any trademarks or copyrights. It’s also a good idea to see if the suggested name is accessible for the domain and social media handles.

Registered office address

The official address of a business or partnership firm that is registered with the government is known as the registered office address. All official communications and judicial notifications should be forwarded to this address. The Registrar of Companies or Registrar of Firms, as applicable, has to be informed of the address, which must be a physical address in India.

Partnership Deed

A partnership deed is an official document that spells forth the criteria under which a partnership business will operate. It includes information on the partners, the type of the firm, the capital commitment, the length of the partnership, and other terms and conditions that the partners have agreed upon. It is a key document that controls how the partnership company operates.

PAN Card and Aadhaar Card

The Income Tax Department issues PAN Cards (Permanent Account Number), 10-digit unique identification number, to taxpayers.The Unique identification Authority of India (UIDAI) issues Aadhaar Cards to Indian citizens, each of which contains a 12-digit unique identification number.

Partnership Firm Registration Form

In India, there is no particular form for registering a partnership firm. The registration procedure of Partnership Firm  is carried out by submitting an application to the Registrar of Firms in the district where the partnership firm will have its registered office, together with the partnership deed and other necessary papers. The Indian Partnership Act, 1932’s Form 1 should be used for the application.

Procedure for Registering a Partnership Firm

Obtain Digital Signature Certificate (DSC) and Director Identification Number (DIN)

A person can select a Certifying Authority (CA) from the list of recognized CAs in India and complete the DSC application form found on the CA’s website to receive a DSC. The applicant must provide the needed documents, including a PAN card, proof of address, and identification, complete the verification procedure in accordance with the CA’s guidelines, and pay the requisite price. The DSC can be downloaded and installed on the applicant’s PC after it has been provided.

A person can visit the Ministry of Corporate Affairs (MCA) website and complete the DIN application form there in order to receive a DIN. The applicant must submit the relevant paperwork, including a PAN card, an address proof, and an identity proof, pay the requisite money, and then wait for the DIN application to be approved. When the DIN is accepted, the applicant will be informed through email, and the DIN may also be verified on the MCA website using the applicant’s name or DIN.

Obtain the partnership firm registration form

The Partnership Firm registration form may be downloaded from the Ministry of Corporate Affairs (MCA) of India’s official website or received from the Registrar of Firms. The application is known as Form 1, and it asks the applicant to supply information such as the name and address of the company, the names of the partners, and the kind of business.

Prepare the Partnership Deed

The Partnership Deed should contain information on the company’s name, the partners’ identities, the profit-sharing arrangement, capital contributions, and the nature of the business. It needs to be printed on paper with a non-judicial stamp and signed by each partner.

Submit the documents and registration fees

The applicant must submit all the required documents along with the registration fees to the Registrar of Firms in their particular Indian state after getting the requisite records and completing the Partnership Deed.

Obtain the Certificate of Registration

The Registrar of Firms will examine and validate the application after receiving all the necessary documents and payment. A Certificate of Registration will be given to the partnership company provided everything is in order.

Post-Registration Requirements

Open a Bank Account

The partnership company should create a bank account in its name after receiving the Certificate of Registration and supply all the required documents, including the Certificate of Registration, Partnership Deed, and KYC records for each partner.

Apply for GST Registration

If the partnership firm’s yearly turnover surpasses a specific level, they must submit an application for GST registration. By submitting the necessary documentation through the GST site, this may be done online.

Obtain any necessary licenses and permits

The partnership firm may need to apply for additional licenses and permissions from local or state authorities, such as a Shop and Establishment license or a Food Safety license, depending on the nature of the business. Depending on the region and company activity, different restrictions apply.

Maintain proper accounting and taxation records

The partnership firm is required to keep accurate books of accounts, bills, invoices, tax returns, and other financial documentation. This is required to follow legal obligations and keep track of the company’s financial performance.

Conclusion

In India, Kanakkupillai is a well-known provider of services for business registration and compliance. Business owners can benefit from a number of advantages, including improved credibility, easier access to bank financing, and restricted liability protection, by registering a partnership firm with Kanakkupillai. But it’s also crucial to follow any post-registration obligations, such as getting the required licenses and permits, keeping accurate financial records, and submitting taxes on time. All of these criteria may be helped with by Kanakkupillai, who can also make sure that the partnership business continues to abide by all relevant rules and laws.

FAQ on Partnership Firm

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Kanakkupillai

Kanakkupillai is your reliable partner for every step of your business journey in India. We offer reasonable and expert assistance to ensure legal compliance, covering business registration, tax compliance, accounting and bookkeeping, and intellectual property protection. Let us help you navigate the complex legal and regulatory requirements so you can focus on growing your business. Contact us today to learn more.