What is a Partnership Firm?
Partnership firm 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. It is owned, managed and controlled by an Association of People for profit. Partnership firms are relatively easy to start and prevalent amongst small and medium-sized businesses in the unorganized sectors.
Partnership firms are created by drafting a Partnership deed amongst the Partners and by a registered Partnership deed, TaxExpressIndia can help you to start a Partnership firm in India.
Government Fees / Cost for partnership firm registration:
Contents of Partnership Deed:
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The name of the firm
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Name and details of all partners
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Date of commencement of business
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Duration of the firm’s existence
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Capital contributed by each partner
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Profit/loss sharing ratio
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Interest on capital payable to partners
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The extent of borrowings each partner can draw
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Salary payable to partners, if any
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The procedure of admission or retirement of a partner
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The method used for calculating goodwill
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Preparation of accounts of the firm
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Mode of settlement of dues with a deceased partner’s executors
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The procedure to be followed in case disputes arise between partners
Price and Plan
Price may varies for different states in India
ESSENTIAL
₹ 1599/-
(All Inclusive)
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Drafting of deed
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Execution of Deed
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PAN
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TAN
ENHANCED
₹ 3399/-
(All Inclusive)
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Drafting of deed
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Execution of Deed
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GST Registration
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PAN
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TAN
ULTIMATE
₹ 10799/-
(All Inclusive)
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Drafting of deed
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Execution of Deed
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Trademark Application (1 Application 1 Class Small Enterprise)
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GST Registration
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SSI/MSME Registration
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PAN
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TAN
Compliance required for Partnership Firm
GST Registration
Partnership firms in India requires GST registration. GST Registration Process is 100% online and there is no requirement of submission of physical documents to GST Department. GST registration must be obtained within 30 days of business incorporation, otherwise, the business will be subject to heavy penalties.
GST Return
Under the Goods & Service Tax regime which apparently rolled out in 2017, partnership firms having GST registration would be required to file GST returns. GST Returns can be filed monthly, quarterly and annual GST returns. As filing of GST returns is mandatory for all the registered Taxpayers including Partnership firms.
Accounting
The accounting for a partnership firm is essential compliance. Every Partnership firm shall maintain proper books of accounts which shall represent an accurate and fair view of the state of affairs of the Firm. In essence, a separate account tracks each partner’s investment, distributions etc.
Tax audit
The Income Tax audit would be needed for a partnership firm if the total sales turnover is more than Rs.1 crore during the financial year. In case of a professional firm, the tax audit would be necessary if total gross receipts exceed Rs.50 lakhs throughout the financial year under assessment.
IT Return
Income tax filing must be filed by all partnership firms. The income tax return of a partnership firm that doesn’t need an audit is due on the 31st of July. If the income tax return of a partnership firm is to be audited according to the Income Tax Act, then the return would be unpaid on the 30th of September.
TDS Return
Quarterly TDS returns must be filed by partnership firms that have TAN and are required to deduct tax at source as per TDS rules. A TDS Return is a quarterly statement which has to be submitted to the IT Department of India. It should contain all details of TDS deducted and deposited by you for a particular quarter.
Documents Required for Partnership Firm
Quick Checklist
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Photograph of all the Partners
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PAN Card of all the Partners
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ID Proof of all the Partners (Driving License/Passport/Voter ID)
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Electricity Bill or any other utility bill for the address proof of the Registered Office
Specific Requirements
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A Company must have a registered office in India. Documents like bank statement or electricity bill should not be older than 2 months. Along with that utility bill, rent agreement or sale deed and a No Objection Letter (NOC) from the landlord with his/her consent to use the office as a registered office of a company must be submitted.
How to Incorporate Partnership Firm
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Complete a Checklist
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Submit Documents
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Verification of Documents
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Drafting & Executing Partnership Deed
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Obtain PAN & TAN