Frequently Asked Questions
What is a Partnership Agreement?Your Partnership Agreement is an agreement between you and your partner(s) that sets out the duties and obligations of the partners to each other and to the partnership.Do I need to register my Partnership Agreement?Your Partnership Agreement is a private contract between the partners and does not need to be registered. However, if you are starting a partnership you do need to advise Inland Revenue of the fact and obtain an IRD number to pay income tax and GST. You can also apply for a New Zealand Business Number (NZBN) to uniquely identify your business.Why have a written Partnership Agreement?The Partnership Act 1908 (the “Act”) applies to general partnerships in New Zealand. When two or more persons work together for profit, the law will usually find that a partnership exists. The Act includes certain rules for the management of partnerships which will apply by default to your partnership if there is no partnership agreement in place.
As these rules may not suit your circumstances, it is best to make your own. For example, under the Act a partner cannot be expelled, partners cannot be salaried, all partners share equally in the profits and losses, and any partner can end the partnership at any time by serving notice on the other partners. This questionnaire allows you to make all these decisions and more as best suits your partnership.