Matters to go into a Partnership Agreement.

   1. Names and addresses of partners.

   2. The fact that the partners are to form a partnership on (date).

   3. The nature of the business.

   4. The place of the business.

   5. The name of the partnership.

   6. The capital introduced into the partnership.

   7. Whether interest is to be paid in the partners capital and if so the rate.

   8. Whether the partners are to be paid a salary before divisions of the profits.

   9. The way the profits are to divided up. (after any interest and salaries).

  10. Drawing rights [how much each partner may take out].

  11. The bank.

  12. Proper books to kept./ All partners to have access.

  13. Partners shall be fair and open with each other.

  14. Details of Partnership management and conduct of meetings.

  1. Formal provisions regarding admission of new partners.
  2. What time to be devoted to the business. Partners shall not work outside the partnership with out written consent.
  3. No partner to lend money or mortgage assets of the partnership without agreement of others.
  4. Limit on partner ability to order goods or services on behalf of the partnership without consent of the other partners.
  5. Reasons for (i.e., breach of terms, bankruptcy, incapacity, or death) dissolution of the partnership.
  6. Method of paying off partner upon dissolution: -

i.e., repaid value of his capital account over 3 years in 6 equal installments commencing 6 months after departure. (However beware of clauses by which remaining partners are required to buy out deceased partners as this can destroy your claim for Inheritance Tax business property relief)

  21. Requirement to give 6 months notice of desire to leave the partnership.

  22. Application of English partnership law.

 

return to leaflets menu