**Partnership Deed Meaning**

A partnership deed, also known as a partnership agreement, is a legal document that outlines the terms and conditions of a partnership between two or more individuals who wish to carry out a business venture together. It serves as a written contract that governs the rights, obligations, and responsibilities of the partners involved in the partnership.

**Partnership Deed and Profit Sharing**

One of the key aspects covered in a partnership deed is the sharing of profits between the partners. The partnership deed specifies the ratio or percentage in which the profits and losses of the business will be distributed among the partners. This profit-sharing ratio is typically based on the capital contributed by each partner or as agreed upon by the partners.

The partnership deed also outlines the method to be used in calculating profits and losses, such as the inclusion of interest on capital, interest on drawings, and the salaries or commissions payable to the partners. It may also specify any additional terms or conditions related to profit distribution, such as the allocation of profits for reserves or the payment of interest on partners' capital.

**Forms of Business Organisation and Partnership Deed**

The concept of a partnership deed is closely related to the forms of business organization. In the commerce field, different forms of business organization exist, such as sole proprietorship, partnership, and company. Each form has its own set of characteristics, advantages, and disadvantages.

The partnership form of business organization is often chosen by individuals who wish to pool their resources, skills, and expertise to establish and operate a business jointly. The partnership deed serves as a crucial document that governs the partnership and ensures that the rights and obligations of each partner are clearly defined.

**Benefits of a Partnership Deed**

A partnership deed offers several benefits to the partners involved in a business venture. Some of these benefits include:

1. Clarity: The partnership deed provides clarity on the roles, responsibilities, and rights of each partner, ensuring that there is no ambiguity or confusion.

2. Legal Protection: The partnership deed is a legally binding document that protects the interests of all partners and prevents any disputes or conflicts from arising in the future.

3. Dispute Resolution: In the event of any disagreements or conflicts between the partners, the partnership deed provides a framework for dispute resolution and outlines the mechanism for resolving such issues.

4. Profit Sharing: The partnership deed clearly specifies the profit-sharing ratio, ensuring that the distribution of profits is fair and transparent.

5. Flexibility: The partnership deed allows partners to customize the terms and conditions of their partnership based on their individual requirements and preferences.

Overall, a partnership deed plays a crucial role in establishing a partnership and ensures that the partnership operates smoothly and effectively. It provides a comprehensive framework for the partners to manage their business and share profits, thereby fostering a successful business relationship.

Partnership deed is an agreement btw the partners mentioning abt the profit sharing ratio, adress, name of partners etc.....