The business activity in which there is more than one owner who run the business by mutual consultation. The partnership involves two or more partners. The minimum limit is 2 and maximum limit is 20 and 10 in case of banking. The availability of capital is high as compared to sole proprietorship. The liability of partners is unlimited. There are liable to pay debts from personal assets.
The decision making is complex because there are more partners. They require auditing their business but it is not compulsory. They maintain their secrecy they have not required to disclose the books of account to the public. They can start their business at large scale because of the availability of capital. No partner can use the property of business without the consent of others partners.
The person under the age of 18 a minor cannot be a partner. If the death of the partner occurs the partnership dissolved. They have to sign an agreement for partnership which is known as partnership deed. Partners are also known as the agents of each others.
Partnership is a registered business. Partners are liable for each other act. The partners cannot do anything secretly without the consent of others. The profit is not disclosed to the public. Some time all partners are not actively work. Some are involved in management and some are only receive profit.
The profit in partnership is divided among partners according to the ratio of their investment. They have to pay tax on profit. This is compulsory for them.