If two or more person want to share risk and profit of business, general Partnership Firm is the simple way to get start a business. Partners manage the firm and has unlimited liability towards the partnership's obligations and debts.
Partnership Firm can be commence its business by executing Partnership Deed which can be registered and unregistered. It is always advisable to registered Partnership deed.
Benefits of Registered Firm:
Drawback of un-registered Firm:
Clauses to be mentioned while drafting a Partnership Deed.
It's a good idea to consult a professional experienced with small businesses for help in drafting the Deed.
A Partnership Firm can be started just by executing a partnership deed between the partners, even the Registration of the Partnership Deed is not compulsory.
A Partnership Firm can be easy dissolved just with the consent of the partners.
Secrecy of Accounts
The Financials of a Partnership Firm are not disclosed to the public.
No Financial Audit
The Partnership Firm is not mandatorily required to get its accounts audited by any chartered accountant unlike a limited company. It is Liable for Income Tax audit, only if the turnover of the firm increases more than 2 Crore in any financial year.