What is Partnership Deed?
In order to understand the partnership deed, the buyer and the owner should acknowledge the existence of this particular deed. While commencing a business deal accompanied by more than two partners, they should map their shares of profit and losses into a written contract also known as partnership deed or agreement.
The collaboration of these business partners agreed by the partnership deed is often termed as partnership firm.
Importance of partnership deed?
When partners have a partnership deed it helps them with legal responsibilities towards the firm. Partnership deeds do not require registrations and can be used anyway.
Benefits of a well contracted partnership deed:
- It adjusts and balances the privileges, duties, and responsibilities of all partners
- It helps in preventing any confusion and misinterpretation between the partners as all the clause of the alliance have been pre-contracted
- It helps in settling disputes between the associates by referring to the points mentioned in the deed.
- It clears uncertainties in terms of profits and losses ratio between partners.
