Partnership

• Inexpensive and quick to establish — Partnership Deed + Registration with Registrar of Firms; no MCA portal complexity
• Combined capital, skills, and professional networks of multiple partners pooled in one business
• No minimum capital requirement and no complex regulatory filings with ROC or MCA
• Flexible profit-sharing arrangements defined in the Partnership Deed — not restricted to shareholding ratio
• Taxed at 30% flat rate on firm's taxable income; partners' share of profit tax-free in their hands
• Working partner remuneration deductible from firm income under Section 40(b) of Income Tax Act
• Registered firm can sue third parties and maintain bank accounts in the firm's name

• Partnership Deed on non-judicial stamp paper (state-specific stamp duty value — typically Rs.200–1,000)
• PAN Cards of all partners and of the firm
• Aadhaar Card or other identity proof of all partners
• Registered office address proof with NOC from property owner
• Passport-size photographs of all partners
• Bank account details for current account opening

1. Draft Partnership Deed: Specify firm name, partners' names and addresses, profit-sharing ratio, partner remuneration, and business objectives
2. Execute on stamp paper: Get the deed signed on appropriate non-judicial stamp paper and notarised by a notary public
3. File with Registrar of Firms: Submit Form 1 under Section 58 of the Indian Partnership Act 1932 with Registrar of Firms in the district where the firm's principal place of business is located
4. Receive Registration Certificate: Registrar of Firms issues the Certificate of Registration of Partnership Firm
5. Apply for PAN & bank account: Apply for PAN in the firm's name and open a current bank account using the registration certificate

Q: Is registration of a Partnership Firm mandatory?
Registration is not legally mandatory under the Indian Partnership Act 1932, but an unregistered firm cannot file a suit against third parties to enforce any rights arising from a contract. Practically, registration is required for bank account opening, GST registration, and government contracts. MFiling strongly recommends registering all partnership firms.

Q: How many partners can a Partnership Firm have?
A Partnership Firm can have a maximum of 20 partners for general business (maximum 10 for banking business). If more than 20 partners are required, the business must be incorporated as a Limited Liability Partnership or Private Limited Company.

Q: Can a Partnership Firm be converted to an LLP or Private Limited Company?
Yes. A registered Partnership Firm can be converted to an LLP by filing Form 17 with MCA, or to a Private Limited Company through a scheme of conversion. MFiling manages both types of conversions including all regulatory filings and deed amendments.