A partnership occurs when you decide to pool capital and work together with at least one more person. In this form of business, you and your partners are joint-owners of the business and therefore will share the business profits and risks.

There are advantages and limitations of running a Partnership type of business. Carefully study the implications of these pros and cons before deciding if this form of business is right for you.

Advantages of Partnership

• Partnership means having more expertise and more resources for capital.
• Partnership means business risks can be distributed and shared among partners.

Limitations of Partnership

• All partners carry the same responsibilities. This means that you are liable for risks and debts of the business even if it is caused by the actions of your partners. With unlimited liability, each partner is also liable to use their private resources to meet the partnership's debts.
• Disagreements and disputes may occur among partners and this may disrupt business plans or operational efficiency.
• A Partnership’s lifespan is limited – it may end if any one of the partners has mental disorder, falls bankrupt, resigns or dies.

Click here for information on procedures with regards to Partnership.