BENEFITS OF A PARTNERSHIP AGREEMENT
A few of the most substantial benefits of partnership agreement are as follows-
- It regulates the rights and liabilities of each of the partners.
- All the terms and conditions are specified in the deed which is very helpful in avoiding misunderstandings between partners.
- Helps settle any dispute amongst the partners.
- The partnership deed also mentions a clause that clarifies what should be the remuneration that is to be paid.
ELEMENTS OF A PARTNERSHIP DEED
A partnership deed contains the following details-
- Business that is to be carried out by the partners of the firm.
- Whether the duration of a partnership firm will be for a limited period or for a specific project.
- Ratio of profits and losses that is to be shared among the partners of a firm/LLP.
- Details of remuneration of the partners.
- Capital contribution to be made by each partner and the interest to be paid on it.
- Policy regarding the drawings from the firm allowed to each partner.
- Duties and obligations that are to be undertaken by the partners.
- Details regarding admission of new partner(s), death and retirement of partner.
A legal expert is required to draft the legal document to make it precise and accurate.
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