A General Partnership is a form of business organization in which two or more individuals manage and operate a business in accordance with the terms and objectives set out in a Partnership Deed (also known as a Partnership Agreement). Each partner in a general partnership is personally liable for the debts and obligations of the business, and they share responsibility for the management, profits, and losses.

Key features of a General Partnership include:

1. **Formation:**
– A general partnership is formed when two or more individuals decide to carry on a business together for profit. While a formal written agreement is not legally required, it is highly advisable to have a Partnership Deed outlining the terms and conditions of the partnership.

2. **Ownership and Management:**
– All partners in a general partnership have equal ownership and management rights unless otherwise specified in the Partnership Deed. Decisions are typically made jointly, and each partner has a say in the business’s day-to-day operations.

3. **Unlimited Liability:**
– General partners have unlimited personal liability for the debts and obligations of the partnership. This means that personal assets of the partners can be used to satisfy business debts. The unlimited liability is a significant characteristic that distinguishes general partnerships from some other forms of business entities.

4. **Profit Sharing:**
– Profits and losses are shared among the partners according to the terms agreed upon in the Partnership Deed. This can be based on the partners’ capital contributions, ownership percentages, or other criteria outlined in the agreement.

5. **Taxation:**
– General partnerships are not taxed at the entity level. Instead, profits and losses flow through to the individual partners, who report their share of the partnership’s income on their personal tax returns. This is known as pass-through taxation.

6. **Flexibility:**
– General partnerships offer flexibility in terms of management and decision-making. There are fewer formalities and regulatory requirements compared to other business structures, making it relatively easy to form and operate.

7. **Duration and Dissolution:**
– General partnerships may be formed for a specific period or purpose, and the partnership may be dissolved when the agreed-upon term expires, or when one of the partners decides to leave. Events such as the death or withdrawal of a partner can also trigger dissolution.

8. **Partnership Agreement:**
– While not legally required, a Partnership Deed is highly recommended for general partnerships. This document outlines the rights, responsibilities, and obligations of each partner, as well as the terms for sharing profits and resolving disputes.

9. **Liability for Actions of Partners:**
– Each partner is legally considered an agent of the partnership, and their actions within the scope of the business can bind the entire partnership. This means that partners may be held liable for the actions of other partners in the ordinary course of business.

10. **Continuity:**
– General partnerships may face challenges in terms of continuity if a partner withdraws or dies. The remaining partners can decide whether to continue the business or dissolve the partnership.

It’s important for individuals considering a general partnership to carefully consider the advantages and disadvantages, and to seek legal and financial advice when drafting a Partnership Deed. The specific regulations governing general partnerships may vary by jurisdiction.