Company registration, Other Legislation : Limited Partnership Act

Limited Partnership Registration is a very crucial part of a partnership business. If you are planning of a limited partnership, then it is essential to know about the concept in details.  The Limited Partnerships Act 1907 is the legislation that governs formation of Limited Partnerships in UK. Talking about the Act will seem meaningless if you are not aware about the basics of limited partnership.

What is limited Partnership?

A limited partnership can be described as a joint venture, which involves one, or more people usually referred to as general partners and are liable of all obligations and debts of the firm. Or, it might also be a joint venture between one or more people who contribute a certain sum of money or a property of a specified amount as a capital for the business. Its noteworthy that limited partners is not liable to any kind of obligations and debts besides the contributed money.

What are the restrictions imposed on limited partners?

Certain restrictions are imposed on the limited partners as per the Limited Partnership Act. A limited partner cannot receive back or draw out the contribution during the lifetime of the company. They are not entitled to participate in the management activities. Lastly, limited partners might not have the power to bind the organization. If they do any of the above, they become responsible for all obligations and debts of the company up to the amount received /drawn out/incurred.

What is the importance of limited partnership registration?

Limited Partnerships Act 1907 clearly prescribes that registration of a limited partnership is necessary. Until registration, all partners remain equally accountable for all obligations and debts.

How to register Limited Partnership?

                       
Limited partnership registration is done under the Limited Partnerships Act 1907. To begin with the registration process, an application (Form LP5) addressing the Registrar and signed by all the partners has to be filed.  Limited Partnership registration gets legalized after registration of a satisfactory LP5.

 
The principal place of business becomes plays a vital role in the registration process. If the partnership is taking place for a business, which will have its head office at Wales or England, applications must be sent to the Cardiff office. Limited Partnerships occurring for businesses having Scotland as the principal place of operation have to send their applications to the Edinburgh office. And finally if your principal business place is somewhere in Northern Ireland, applications must be sent to the Belfast office.
The application form has to be furnished with the following information:

• The amount of money contributed by every limited partner and whether its paid in cheque, cash or otherwise.
• A declaration that the partnership is limited along with a brief description of each one
• The terms of partnership that becomes valid from the date of registration
• List of limited and general partners and full name of every partner
• Location and address of the principal office
• Nature of the business
• Name of the firm including the appropriate ending

                                                                                                                          
If all the above-mentioned details are mentioned properly in the registration form, the Registrar issues the registration certificate, subject to the suitability of the name. The cost of registration is very nominal. General registration can be done for 20 pounds whereas same day registration is possible on a payment of 50 pounds.

Dissolution of limited partnership is also possible as per Limited Registration Act.