Partnership

A partnership is an agreement in which two or more persons combine their resources in a business with a view to making a profit. To establish the terms of the partnership and to protect partners in case of a disagreement or dissolution of the partnership, a partnership agreement should be drawn up with the assistance of a lawyer. Partners share in the profits according to the terms of the agreement. There are two different types of partnerships:

General Partnership All members share the management of the business and each is personally liable for all the debt sand obligations of the business. This means that each partner is responsible for and must assume his consequences of the actions of the other partner(s).

In a limited partnership some members are general partners who control and manage the business, and may be entitled to a greater share of the profits. Other partners are limited and contribute only capital; they take no part in control or management and are liable for debt to a specified extent only.

A legal document, setting out specific requirements, must be drawn up for a limited partnership .All partnerships must be registered .Advantages Disadvantage Ease of formation Low start-up costs Every business, whether it is a sole proprietorship, partnership, or corporation, is required to register a business name, with the exception being individuals who operate a sole proprietorship under their own personal name (e.g. John Doe).