Advantages of Registration of a partnership firm

Advantages of Registration of a partnership firm

Advantages of Registration of a partnership firm

Registration of firms by partnership deed plays a vital role for the partners. Partnership deed is an agreement that details on rights and responsibilities of all parties to deal the business operations. It acts as a guide to the partners for effective functioning of a firm. In other words, partnership deed is a written agreement signed by the partners. Registration is not mandatory and there are no penalties for non registration of the firms.

Advantages of Registration of a partnership firm:

  1. Registered firms are safeguarded by law in case of filling suit against the parties. The rights of registered firms are regulated by act of parliament and can enforce any right arising from contract.

  2. The rights and privileges of the partners are secured by legislation. If partners steal the property of the firm, the partners can prosecute against him.

  3. The property of the partners continues to be protected even in case of retirement.

  4. There is a legal protection in accordance with government rules and regulation.

  5. Registration gives reputation to business firms as its copy rights for the products and trademarks are secured.

  6. Banks and financial institutions render money to registered firms when compared to other unregistered firms.

  7. Trust and confidence is built among the business partners who indulge in business activities with a registered company.

  8. Government renders many facilities and provisions to registered firms which enhances the company’s growth.

  9. People also have more confidence in registered firms as fraudulence activities are absent in registered firms as it is legally abided under government’s supervision.

  10. Procedure to follow in registering a firm is simple.

  11. Registration of partnership firm is mostly suitable for medium size businesses.

  12. It helps in avoiding misunderstanding between the partners in the future.

The procedure for registration of partnership firms is easy and simple. In order to make registration of a company a filled application and prescribed fees are essential. The following documents have to be given for registration of a firm:

  1. Application for registration of partnership as in Form No. 1

  2. Duly filled specimen of affidavit

  3. Certified true copy of the partnership deed

  4. Ownership proof of the rental/lease agreement of the business

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