Partnership Firm

A Partnership Deed should include:

• • Business Name and Address
  • Capital Contributions by each partner
  • Profit-sharing ratio
  • Roles and Responsibilities of each partner
  • Terms for admission and exit of partners
  • Dispute Resolution Mechanism
  • Duration of the partnership (if applicable)
  • Liabilities of each partner
  • Terms of dissolution if required

In a partnership, the firm itself is not taxed. Instead, profits are passed through to the individual partners, and they report them on their personal Income Tax Returns. The partnership is required to file its tax return, and each partner is taxed based on their share of the income, following the Income Tax Act.

• In a general partnership, partners have unlimited liability, meaning personal assets can be at risk in case of business debts. To limit liability, you can opt for a Limited Liability Partnership (LLP) instead, where partners’ liability is restricted to their capital contribution, or you can use business insurance to mitigate some risks.

No, you do not need to be physically present in India to form a partnership firm. Most procedures, including PAN application, GST registration, and Partnership Deed creation, can be done online. However, the registered office address must be in India, and partners can sign documents remotely with proper notarization if needed.