What is a partnership?

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A Partnership is a business owned and run by two or more people, with the partners sharing the profits according to the percentage they own. All partners are responsible for the debts and contracts of the business and are personally liable if the business does get into financial difficulties.

Partnerships can be a great way to operate if you are looking for a simple way of going into business with one or more people.

 

Advantages

  • Cheap and simple to operate
  • You don’t have to worry about paying yourself a salary
  • You don't have to deal with Companies House, just HMRC
  • Easy to set up and close down

 

Disadvantages

  • The partners are personally liable for the debts of the business
  • If your profits are over £40,000 it can be less tax efficient
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