A Partnership is one of the forms of business structure available to run a business. However, it is a form of business most suitable for the professional services sector.
A partnership is formed between two or more individuals who agree to carry out the business as partners. There are different types of partnerships: limited partnerships, limited liability partnerships, and unlimited partnerships.
In Nigeria, partnerships are named by the registration of a Business Name with the Corporate Affairs Commission, but the legal existence of the partnership is signified by a written agreement, the Partnership Agreement, signed by all of the partners.
The Partnership Agreement is the “operating manual” for the partnership arrangement. It will cover key provisions like the name of partnership, the nature of its business, details of the partners, the capital to be contributed by the partners to the business, details on capital distribution (profit-sharing) and tax deductions, accounting for the partnership, appointment/removal/retirement of partners, and even provisions for dissolving the partnership.
The Partnership Agreement will be accompanied by supplementary agreements like the deed of adherence (an agreement for any partner subsequently joining the partnership), and the deed of retirement (as agreement for any partnering leaving the partnership).
To find out more on what type of business structure works for your intended business, book an appointment with JEE Client Services now.
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