A partnership firm is one of the widely used business structures in India. Most of the startup and entrepreneurs prefer this business structure due to ease of formation and less compliance. Besides, the partnership business model provides a lot of flexibility and allows partners to focus on the key business areas.
Unlike sole proprietorship, where the owner is always at the risk of losing business asset under relentless fiscal pressure, the partners in the partnership firm will be equally liable for profit and loss incurred by the company. If you have a partnership firm in Hyderabad and are eager to register it in one go, this blog is for you.
Registration of Partnership Firm in Hyderabad
The registration of partnership firms in Hyderabad is more or less the same across other cities of India. The most noticeable difference is the stamp paper’s value for the drafting of a Partnership Deed and the registration fees. Since this business model support multiple partners to work cohesively in a single unit, the influx of partnership firm in Hyderabad is increasing every passing year.
When contrasted with Limited Liability Partnerships (LLPs), such firms encounter less compliance and offer more stability. Partners do not have to face the trouble of availing separate DSCs, DINs, & so on to register as a Partnership Firm in Hyderabad. It is essential to keep in mind that such firms come under the Telangana Government regime and not the Ministry of Corporate Affairs.
Read our article:An Analysis on What is a Partnership Firm and How to Register It!
What are the Laws Governing Partnership Firm Registration in India?
The Partnership Firm registration is governed by the provisions mention under Section 8 of the Indian Partnership Act, 1932. According to this Act, partnership firm registration is not compulsory at the time of formation.
That means the firms are not under any legal obligation to select this registration. Such registration can be availed voluntarily through a proper legal procedure. In Telangana, the process of registering a partnership firm is regulated by the District Registrar working under Registration & Stamps Department.
What are the Documents Required for Registering Partnership Firm in Hyderabad?
How to Register a Partnership Firm in Hyderabad?
The registration of a partnership firm in Hyderabad is done via the registration & Stamps Departments. The Telangana Government manages this, and most of the registration formality is completed on their official portal. Interested people can leverage the underneath instructions to register a partnership firm in Hyderabad.
- Before registration, the partners are recommended to validate their proposed name to avert chances of violation of a registered trademark or copyright. While you can register a company with an identical name, this could lead to legal hassle later on and must, therefore, be prevented.
- After running a trademark and name search, the partners can approach toward registration process under an acceptable name.
- Next, the partner has to draft a partnership deed under a supervision of a lawyer. The partnership deed is a legally-binding document that reflects the duties and the obligation of the partners in a partnership firm.
- A partnership deed ought to enclose the given information and details;
- Name and address of the Firm
- Name and address of all the partners
- Nature of business
- Date of business commencement
- Duration of the partnership
- Each partner’s capital contribution
- Profit-sharing ratio
- Procedure to arrange for an audit
- Salaries and commissions are paid to each partner.
- Rules, duties, and the responsibilities of each partner
- Each partner’s Loan and thecapital interest
- Specify rules to follow in case of death or retirement of partners
- The partnership deed is typically drafted on a stamp paper whose value differs from state to state. After the post-registration phase, each partner has to retain a deed copy, and the same must be provided to the ROFs (Registrar of Firms)
- The partners must then head over to the Telangana Government’s official portal & fill the relevant application.
- The applicant must fill the given information online;
- Company name & address
- Joining date of each partner
- Partner’s Names & addresses
- Firm Duration
- All the partners must approve the application form by signing it.
- The payment related to the registration fee shall be made via online portal.
- Finally, the partners must send the said application attached with the requested documents to the Registrar of the area.
- After submission, application will be verified by the Senior Assistant of the District Registrar’s office.
- If the said officer found the application legitimate in every aspect, an approval letter will be forwarded to the District registrar.
- Depending on the recommendation rendered, the District Registrar will stamp his/her approval on the registration and electronically sign the registration certificate.
- From a taxation standpoint, the company must then register with the income tax department & apply for a Permanent Account Number (PAN) card.
- After availing of the PAN, the partner can visit their designated bank to open the current account in the company’s name.
- The issuing of the Registration Certificate generally takes three days if the verification is successful.
Selecting a structure like a partnership firm for starting a business is the perfect option from the growth and compliance standpoint. Such a business structure is more likely to give long-term growth due to fewer legal hindrances.
We hope that you can now easily register your Partnership Firm in Hyderabad with the help of the information above. If you run into some legal trouble or other issues during the registration process, then feel free to contact CorpBiz’s associate without any hesitation.