Are you interested in starting up a small business as a partnership, or do already have a small or medium sized enterprise and want to bring in someone new as a partner? If you answered “yes” to either of these questions then there are certain legal partnership agreements that you will need to consider.
What Constitutes a Partnership?
A partnership is when two or more people decide to go into business together and equally share in its profits. Because it is relatively easy to set up, partnerships are a very popular way to form a business. All partners involved are considered self-employed. It is widely advised that such business set-ups be governed by partnership contracts.
Unlike other business structures, the legal entities consist only of the partners (no shareholders, etc.). Should something unfortunate happen to the partnership (bankruptcy, resignation or death of a partner), the partnership must be dissolved. In this scenario, a partnership dissolution agreement is advised. However, the business can continue to function whilst a new structure is put into place.
Partnership Agreements and Liability
Unlike a “limited” partnership, all persons in a partnership are liable for any debts or liability that may occur from the business. In Northern Ireland, partners are not severally liable. This means that no one partner has to pay off the entire debt. However, should a partner resign, the remaining partners may be liable for the debt that remains. In the case of insolvency, creditors can go after the assets of any or all partners.
Because of these legalities, it is best that you research the proper partnership agreement.
How Do I Set Up a Partnership?
There are several recommended steps to follow in order to form a successful business partnership. Listed below are some of the most important factors you should consider.
- Create a business plan.
- Enter in a legal business partnership agreement. Standard partnership documents are available online.
- Have your financing worked out, open a bank account, and obtain the services of an accountant.
- If you use your own name, you won’t need to register. However, most do not which necessitates registering the name of the business with the Business Names Register at the Companies Registration Office.
- If you plan to hire employees, it’s necessary that you become acquainted with the Safety, Health and Welfare at Work Act of 2005.
- Find out if you need to obtain a business license to legally run the business. In Ireland, enterprises that always require a business license include pubs, employment agencies and driving schools.
- Register for all the taxes; VAT, PAYE and Income Tax.
- Find a suitable location from which to run your business.
- Consider the types of insurance you will require (liability, fire, etc.).
Online Business Partnership Agreements
Whether you’re starting up a business partnership or adding a partner to an existing business, it is often recommended that you have a solicitor draw up the necessary partnership documents.
However, there are many reputable online websites that offer very affordable partnership agreements without the need for hiring a solicitor. One such site is Net Lawman.
Net Lawman has partnership agreements that are suitable for all types of business partnerships in Ireland along with full explanatory guidance notes. Should what you need not be on their list of standard document agreements, they will draft one to suit your specific needs. For specific information on partnership agreements visit partnership-agreement-ireland.php?docid=IE-PTN001&categoryID=7″>netlawman.ie