A partnership is made up of two or more people who jointly carry on business with a view to profit. Partnerships can be either general or limited.
A general partnership is one where all partners are equally responsible for the management of the business, and each has unlimited liability for the debts and obligations it may incur.
A limited partnership is one where the liability of one or more partners for the debts and obligations of the business is limited. A limited partnership consists of one or more general partners (whose liability is unlimited) and one or more limited partners.
In a limited partnership:
- the general partners manage the business and have the power to enter binding agreements on behalf of the partnership; their liability for the debts and obligations of the limited partnership is unlimited
- the limited partners are passive investors; they must not manage the business and their liability for its debts and obligations is limited in proportion to the amount they have agreed to contribute to the partnership.
A limited partnership is formed when the partnership is registered. Registration also confirms each limited partner’s investment and liability.
Victorian limited partnerships must be registered with Consumer Affairs Victoria under the Partnership Act 1958. For more information, see Register a limited partnership.
Responsibilities after registering
Once you have registered, you must include the words ‘A Limited Partnership’ next to your business name on all stationery and documents.
You must also display your certificate of registration at your registered office.
For information on what to do if there is a change to the limited partnership, see Change a limited partnership.
Incorporated limited partnerships
An incorporated limited partnership is a special type of limited partnership, primarily used by businesses engaged in high-risk venture capital projects.
Application for incorporated limited partnerships
This application is complex, so you should seek independent legal advice when establishing this type of partnership and completing the application form.
Incorporated limited partnerships must be registered with us. For more information, see Register a limited partnership.