Partnership Agreement Template
A partnership agreement documents the rights and obligations of partners carrying on a business in common with a view to profit. Use our free New Zealand template to clearly record capital contributions, profit shares, management, and dissolution under the Partnership Law Act 2019.
What Is a Partnership Agreement?
A partnership agreement is a contract between two or more persons carrying on a business in common with a view to profit — the statutory definition of a partnership under section 8 of the Partnership Law Act 2019. While partnerships can arise by conduct without any written document, a written agreement is strongly recommended to override the default rules in the Act and to reflect the commercial deal the partners have actually struck.
Without a written agreement, the default position under the Partnership Law Act 2019 applies: partners share profits and losses equally, no partner receives a salary, any partner can bind the partnership, and the partnership dissolves on the death or withdrawal of any partner. These defaults rarely reflect partners’ actual intentions, which is why a tailored agreement is essential.
A partnership agreement addresses profit and loss sharing, capital contributions, management authority, admission and retirement of partners, treatment of goodwill on exit, restrictions on competing activities, and dispute resolution. It is the operating manual for the partnership and the foundation for any future accounting, tax, and dissolution matters.
What's Covered in This Template
Our partnership agreement captures the governance, financial, and exit provisions needed for a New Zealand general partnership.
Partners and Business
Identification of all partners with NZBNs, the partnership name, and the nature and scope of the business.
Capital Contributions
Initial cash, asset, and in-kind contributions by each partner, and rules for future capital calls.
Profit and Loss Allocation
How profits and losses are shared, whether equally, in proportion to capital, or under a custom formula.
Partner Drawings and Salaries
Entitlement to regular drawings and any salary or service fee payable to working partners.
Management and Decision-Making
Day-to-day management, ordinary decisions, and reserved matters requiring unanimous or supermajority consent.
Banking and Financial Records
Partnership bank account, accounting method, financial year, and audit requirements.
Admission and Retirement
Procedures for admitting new partners and for retiring, withdrawing, or being removed from the partnership.
Goodwill and Valuation on Exit
How a departing partner’s share is valued and paid out, including any goodwill component.
Restraint of Trade
Reasonable restrictions on former partners competing with, or soliciting clients or staff from, the partnership.
Insolvency and Dissolution
Events triggering dissolution and the process for winding up the partnership’s affairs.
Tax and GST
Partnership’s IRD number, GST registration, and the responsibility of each partner for income tax on their share.
Dispute Resolution
Escalation, mediation, and jurisdiction in the District Court or High Court for unresolved disputes.
How to Create a Partnership Agreement
Complete the steps below to generate a tailored partnership agreement for New Zealand.
- 1
Enter Partner and Business Details
Provide each partner’s name, NZBN (if any), address, and the partnership’s trading name and nature.
- 2
Set Capital Contributions
Specify each partner’s initial contribution and the rules for additional capital calls.
- 3
Agree Profit Sharing and Drawings
Choose profit-sharing ratios and the monthly drawings or salary (if any) for each partner.
- 4
Configure Management and Voting
Decide on day-to-day authority, reserved matters, and thresholds for major decisions.
- 5
Review Exit and Download
Confirm the exit mechanics, restraint terms, and dispute resolution, then download the PDF.
Legal Considerations
Partnerships in New Zealand carry unlimited joint and several liability for partners and require careful documentation.
This template is for informational purposes only and does not constitute legal or tax advice. Partnerships involving significant capital should be reviewed by a New Zealand lawyer and chartered accountant.
Reviewed for New Zealand law
Liability of Partners
Under sections 13–15 of the Partnership Law Act 2019, every partner is an agent of the firm and the other partners, and partners are jointly liable for debts and obligations of the firm incurred while they are partners. For wrongful acts or omissions, liability is joint and several. This unlimited personal liability is the principal reason many NZ businesses prefer a company structure; partners should consider limited partnerships under the Limited Partnerships Act 2008 if limited liability is important.
Displacing the Default Rules
Sections 31–44 of the Partnership Law Act 2019 set out default rules covering profit sharing, indemnities, partner salaries, dissolution, and majority decision-making. These apply only in the absence of a written agreement. A comprehensive partnership agreement displaces the defaults and records what the partners have actually agreed.
Tax and the Partnership
A partnership is not a separate taxpayer. Each partner returns their share of partnership income or loss in their own income tax return under subpart HG of the Income Tax Act 2007. The partnership itself may still need to register for GST and obtain its own IRD number for administrative purposes. The agreement should address how tax is allocated between partners and how ACC levies and KiwiSaver are handled.
Restraint of Trade on Retirement
A restraint of trade binding a retiring partner is enforceable only to the extent reasonable. In partnership contexts, courts have historically been more willing to enforce restraints because partners have access to the firm’s goodwill and client relationships. Section 83 of the Contract and Commercial Law Act 2017 permits courts to modify unreasonable restraints rather than void them entirely.
Frequently Asked Questions
Build a Strong Partnership Foundation
Create a clear, tailored New Zealand partnership agreement that protects every partner and prevents disputes down the track.
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