What is A Partnership Deed Format?
A partnership deed is a written and registered agreement between two or more people, who want to start a business together. As per the partnership deed format, parties involved have agreed to share profits and losses with each other, along with starting the business.
What Are The Benefits Of A Partnership Deed
- A written and registered agreement serves as a formal agreement between two or more parties. Hence, a partnership deed serves better than an oral agreement.
- Also, a partnership deed also clearly states the rules and regulations, as well as, profit sharing ratio, to be followed by partners.
- A partnership deed helps in avoiding confusion among partners of the firm, as it clearly states the details of each partner.
- In the event of a dispute, partners can refer to the partnership deed to resolve disputes.
What Are The Checklist Clauses of a Partnership Deed Format?
- Company name and address on the partnership deed of a firm
- Partner Details on the partnership deed of a firm
- Partner Capital Contribution
- The Accounting period on the partnership deed of a firm
- Partnership Formation Date
- Rules of Operations for Bank Accounts as stated on the partnership deed of a firm
- Profit and loss sharing ratio;
- The rate of interest on capital, loan, drawings, etc;
- The rules to appoint the auditor.
- Payables to partners;
- The rights, duties, and liabilities of each partner;
- Rules & regulations to be followed when it comes to the dissolution of the firm;
- Rules & regulations to be followed when it comes to admission, retirement, the death of a partner.
How To Draft A Partnership Deed?
Total Number Of Partners:
For drafting a partnership deed form, there is a minimum requirement of 2 partners.
- For drafting a partnership deed form for banking businesses, there is a requirement of ten or lesser partners.
- For drafting a partnership deed form for non-banking businesses, there is a requirement of twenty or lesser partners.
When it comes to investing capital in a partnership, there is no minimum or maximum limit. However, the stamp duty will depend on the capital invested by partners.
Deciding On The Name:
The name of the business or the brand needs to be entered in the partnership deed form. For this reason, great care and attention should be taken while deciding on the business name.
What Are The Documents Required For Preparing A Partnership Deed
- Address Proof of your firm.
- Identity proof of partners
- Address proof of partners
- Attested Partnership agreement
- Stamp Duty of appropriate value
- Photographs of all partners.
- Partnership Deed Application form
Frequently Asked Questions
- A partnership deed is a legally binding contract between two or more partners in a business.
- The minimum members for preparing a partnership deed is two. While there are limitations with banking and non-banking business.
- The mutual consensus among partners to do business.
- Partner profit sharing ratio among all the partners.
- All partners are expected to be answerable for the actions of each other.
The minimum stamp duty is using a non-judicial stamp paper of Rs. 200.
When a partner retires, he/she gives up all rights, liabilities, and stake in the company.
If a partner dies, the partnership deed is referred to regarding how to move forward. If there are no conditions or clauses regarding the same, then all rights, liabilities, and stake in the company reverts successor of the deceased partner
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