Can a partnership firm give a loan to partners? The Partnership Act doesn’t restrict a company of this type from giving loans unless the Deed of Partnership prohibits it. However, the loan should never be given or repaid in cash.

Business Terminology

Partnerships and corporations are alike in some ways, so it’s easy to confound these terms. The individuals who own a corporation are the shareholders. The individuals who own a partnership are the partners. The difference is relevant because they determine how ownership interests are handled. Corporations issue stock shares, whereas partners own a percent of the business. Continue reading →