How do you arrange Partnership Agreements?

I've obtained a client who has no Partnership agreement in place. As a tax avoidance measure, with some good commercial reasoning to boot, it has been proposed to admit several long-term employees into Partnership.

The current Partnership has no agreement. The intention is to have a two tiered system whereby the current Partners are "Senior" and entitled to a higher profit share than the new "Standard" Partners. It is also intended to have allotted "Salary" rates for each Partner based on hours work with residual profits in a profit share arrangement.

The Senior Partners have power to vote (jointly) to remove any Standard Partner.

My first suggestion was to use a law firm so as to absolve us of responsibility.

I guess I have two questions:

  • Does anyone else generate Partnership agreements in-house without a qualified Solicitor?
  • What would be your expectation of costs to implement the above agreement using a Solicitor?

I have no issue drafting it personally. However my only concerns are whether I can provide "due care and attention" without the legal basis and what our insurers may think!

 

Cheers,

Chris

Comments
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On your own head

Roland195 |

.

cparker87 |

Woah!

neileg |

Money well spent

Roland195 |

That's what I have done in the past but...

Paul Scholes |
Paul Scholes's picture

.

cparker87 |

To an extent

Roland195 |

Other issues

Marion Hayes |
Marion Hayes's picture

Drafting a partnership agreement

law man |

Not as simple as that

neileg |

Most key warnings given above

bookmarklee |
bookmarklee's picture

You might also want to look

michaelblake |