Partnership. Being in a partnership has its good and bad points.

Partnership

Compulearn is a partnership. It is owned and set up by Mr Aman Chandhok and Mr Manoj Bhandari which means the both of them have unlimited Liability, i.e. Loss of their personal assets in case the business becomes insolvent.

In this section, I will be discussing then advantages and disadvantages of being in a partnership.

Advantages

• Easy to set up – partnerships are easy to set up. Two or more people can start in business as partners with few legal documents. Many partnerships draw up a deed of partnership.
• Easy to run – partnerships are easy to operate. Accountants and solicitors don’t have to be employed. In practice partnerships may use an accountant to keep their books for tax purposes. A solicitor may also be needed to draw up a deed of partnership. This is not true of limited liability partnerships. these partnerships may be complex to run as a company. For instance, accounts have to be audited by an independent accounting firm and sent to the Registrar of Companies.
• Tax advantages – partners pay lower National Insurance contributions than they would if the set up a company and paid themselves a salary.
• Control – The partners share control of the business. In many businesses, each partner has an equal say in how the business should be run. However, some partners may be given more responsibility and control. This would be shown in the deed of partnership. Because partners usually work in the business, they have a good knowledge of how it works. This allows them to make more informed decisions
• Capital – All partnerships have the advantages over sole proprietorships that two or more people are likely to raise more money than one. This usually allows more money to be invested in the business. Limited liability partnerships have the added advantage that limited liability can attract individuals to invest in a business.
• Expertise – another advantage over a sole proprietorship is that partners can have different areas of the expertise. The partnership can then benefit from specialisation. Each partner is doing what he or she is best at. this is likely to strengthen the business.
• Profits – All the profits of the business are kept by the partners. There is a clear link between effort, success and money earned. So there is a strong incentive oto make the business work. the partners may share profits equally or not. This will be shown in the deep of partnership.
• Privacy - except for the few limited liability partnerships, the accounts of the business are private. Only the Inland Revenue and customs and excise have the right to se the accounts.
• Labour relations – Partnerships tend to be larger that sole proprietorships. More people usually employed. Even so, many partnerships remain small. So relations between employees and partners are likely to be good
• Flexibility – like sole traders, partners often have more flexibility about when and how they work than employees. The may have to liaise with their partners, thought, if they want to  take a day off to take care of children, for instance .
• Professionalism – partnerships are the accepted for of organisation in business like doctors, accountants and lawyers. In these professions, there is a great deal of expertise about how to run the business successfully.