Partnership is a business owned by two or more people.
A partnership carries an unlimited liability. It is advisable to have a formal agreement which states how much capital each partner has to contributed, how profits and losses will be shared and other terms of the running of the business. This is referred to as the deed of partnership. In simple terms, the partnership agreement. Partners who provide capital but do not get involved in the day to day running of the partnership business are often referred to as sleeping partners. Professionals in the service industry generally form business partnerships to pool together their experience and expertise.
Partnership advantages, to name a few:
- The principal and obvious advantage over being a sole trader is the benefit of shared responsibility. It allows partners to specialise in their various fields and focus on the different faculties of their profession
- More people equates to more resources in the form of time, skill, capital and also facilitates the taking of holidays without a loss of revenue
- It allows the administration and running of the partnership to be split between partners according to their specialisms ie human resources, finance, public relations, marketing and more
- Enables consulting over of difficult business decisions without the loss of business privacy
Partnership disadvantages, to name a few:
- The risk of an unlimited liability to settle business debts
- The joint and several liability, meaning, one partner may be held to account for the actions of another partner
- Discontent and disputes over the contribution that each partner makes or does not make to the partnership and how this may be reflected in the sharing of the partnership profits
- Marrying of different and ever evolving personalities of partners without detriment to the business
Our Partnership Tax and Accountancy service can be provided as an individual service or may be combined with other tax and accountancy related services as part of an annual package that we can offer as your appointed Accountants and Tax Advisers.
For well over 20 years we have served as Partnership Accountants and Tax Advisers to Brighton, Crawley, Croydon, Eastbourne, East Grinstead, Gatwick, Godstone, Haywards Heath, Horley, Horsham, Hove, Lingfield, London, Oxted, Redhill, Reigate, Tunbridge Wells and most of Surrey and East and West Sussex, and now service most of Greater London.
Call us for an immediate appointment for Partnership Tax and Accountancy advice and help or any tax and accountancy related matter.