{An ISO 90001-2008 Certified Company}

A Unit of Webtel Electrosoft Private Limited

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CHAPTER -7 INCOME FROM PARTNERSHIP FIRM

WHAT IS PARTNERSHIP FIRM

PROCEDURE FOR REGISTRATION OF A PARTNERSHIP FIRM

INCOME FROM PARTNERSHIP FIRM

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What is partnership firm

CHAPTER -7 INCOME FROM PARTNERSHIP FIRM

A Partnership firm refers to a business

house which is owned by two or more

people jointly. If any partner become

insolvent or dies, the partnership firm gets

dissolved.” To make a partnership firm there is

need to make a partnership between two or

more people.

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Advantages / Disadvantages of partnership FIRM

Advantages

• Easy to Form(No legal formalities)

• Availability of Large resources

• Flexibility in operation

• Better Decision

• Sharing Risk

Disadvantage

• Limited Capital

• Absence of Legal Status

• Dissolution

• Mutual Trust

• Sharing of Profit

CHAPTER -7 INCOME FROM PARTNERSHIP FIRM

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Procedure for registration of a partnership firm

• As per Section 58 of the Act, a firm may be registered at any time by filing an application with

the Registrar of Firms of the area in which any place of business of the firm is situated.

• It is not compulsory to get registration of firms. It is optional for partners to set the firm registered

and there are no penalties for non-registration.

The law relating to a partnership firm is

contained in the Indian Partnership

Act, 1932.

CHAPTER -7 INCOME FROM PARTNERSHIP FIRM

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Make an Application

Prescribe Form for Incorporation in FORM 01 and Affidavit

Attached Certified copy of Partner ship Deed and ownership proof of the principal place of business

Submit all Document to the Registrar

Procedure for Registration of a partnership firm

Hyperlink

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When the Registrar of Firms is satisfied that

the provisions of section 58 have been duly

complied with, he shall record an entry of the

statement in the Register of Firms and

issue a Certificate of Registration.

Procedure for registration of a partnership firm

CHAPTER -7 INCOME FROM PARTNERSHIP FIRM

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For Examples MR. MANOJ KAUSHAL

and MR.PRASHANT has started a

partnership firm with the name of M/S

PRAMAN SALES. before start the

business they have decided to make a

PARTNERSHIP- DEED Click here for Partnership deed

Hyperlink

Procedure for registration of a partnership firm

CHAPTER -7 INCOME FROM PARTNERSHIP FIRM

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Responsibilities of a firm

At the end of year firm has to Maintain

• Profit and loss account

• Balance Sheet

• Profit and Loss Appropriation Account

• Computation

• Depreciation

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CHAPTER -7 INCOME FROM PARTNERSHIP FIRM

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• Partner’s Capital Accounts

• Interest on Partner’s Drawings

• Interest on Partner’s Capitals

• Salary or Commission to Partners

• Interest on Partner’s Loan

• Capital Ratio and distribution of Sharing Profit

Some Accounts requiring consideration while preparing the final

account. These are

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CHAPTER -7 INCOME FROM PARTNERSHIP FIRM

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Assessment of Firm

Net Profit as per Profit and Loss Account

Add: In-admissible Expenses

Less: Income credited to P & L A/c but taxable under other heads

Less: Admissible Expenses

Less: Maximum amount allowed on account of Remuneration U/s 40b

Less: Deduction chapter VI A

Net Taxable Income from Partnership Firm

CHAPTER -7 INCOME FROM PARTNERSHIP FIRM

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