Partnership Firm

In simple words partnership firm is similar to the Sole Propreitorship Firm but its required the minimum 2 person for the Registration. If you have partners in the business & want to test your ideas then best thing is always go with the Partnership Firm.

Now Partnership firm also can be classified 2 types -

a) Partnership Firm without Registrar of Firms - Registrar of Firms is basically a department which is setup by the govt of India for the Partnerships which are properly registered with the govt. so now these days LLP Concept comes(Explained Later) and if you want to test your ideas then partnership firm without registrar of firms is enough.

Now if your register your firm with the Registrar of Firms then cost is Equal to the LLP which give you more advantages. so people prefer the setup a partnership firm without the Registrar of Firms.

b) Partnership Firm with the Registrar of Firms - Its a Properly Registered with the Government of India but increase the cost of formation as explained above. so if you have complicated old family business then prefer the partnership firm with the proper registration.

Note - if you not register your Partnership Firm with the Registrar of Firms then you can’t send the Legal Notice to anyone.

Procedure to Register Partnership Firm - Its required basic documents and prepare 2 things

• Partnership Firm Deed
• PAN 

So Partnership Firm Deed is like agreement where partners terms & conditions are mentioned like Profit & sharing ratio etc.

Documents Required -

• Partners PAN CARD & Adhar Card or Voter id or Passport anyone
• Firm Address Proof like rent agreement or elect bill copy or sale deed etc.

Advantages -

• Best for the testing your ideas in the starting with the Co Founders
• Less Annual Maintenance compliance as compared to the LLP or Company

Disadvantage -

• If you firm is not register then you can’t send the Legal Notice on Firm name
• Not a Separate Legal Entity and have no limited liablity feature.

Costing -

• Without Registrar of Firms Its Cost nearby 2000 to 5000 INR
• With Registrar of Firms Its Cost nearby 7000 to 10000 INR.