What is a Partnership Agreement?

A Partnership Agreement is a contract between two or more people who run a business together and share its profits. It records how much each partner contributes, how profits and losses are split, who manages what, and how a partner can join or leave. It is the single best way to prevent the disputes that break up otherwise healthy partnerships.

Why a written agreement matters

Without one, a partnership runs on assumptions — and assumptions collapse the moment money, workload or an exit is in question. A written agreement gives every partner certainty and protects the business.

What to include

  • Partners' details and the name and purpose of the partnership.
  • Capital contribution from each partner.
  • Profit and loss sharing ratios.
  • Management, decision-making and the managing partner.
  • Admission and exit of partners, and what happens on death or withdrawal.
  • Dispute resolution and dissolution.

Create your Partnership Agreement

Answer a few short questions and download your agreement as Word and PDF. Related: Founders' Agreement, Joint Venture Agreement.

FAQ

Is a partnership a separate legal entity?

A general partnership is generally not separate from its partners, so a clear agreement (and appropriate registration) is important to manage liability.