Why it matters
- Each state and territory has its own Partnership Act (for example, the Partnership Act 1891 in Queensland and the Partnership Act 1892 in New South Wales). These set default rules where partners have not agreed otherwise.
- Partners are generally liable for the debts of the partnership and can bind each other. A written agreement helps manage that risk.
- Consider with your accountant whether a partnership, company or trust structure is right for you.
Profits, losses and capital
- How profits and losses are shared — not necessarily equally.
- What capital each partner contributes and whether it earns interest or is repaid on exit.
- Drawings: how much partners can take and when.
Management and decisions
- Each partner’s role and time commitment.
- Which decisions need all partners to agree, and limits on any one partner committing the business.
Adding or losing a partner
- How a new partner is admitted.
- What happens on retirement, death, incapacity or a partner’s breach — including how their share is valued and paid out.
- Whether the business continues or is wound up.
Disputes and restraints
- A dispute resolution process such as negotiation followed by mediation.
- Reasonable restraints on competing or taking clients after leaving.
Need help with this?
Tell us who the partners are, what each contributes and how you intend to share profits. We’ll discuss the scope and engagement terms before drafting.
General information only, not legal advice. Laws differ between states and territories and depend on your circumstances.