How partners share profits when there's no written agreement
Partnerships Act, 2012 · sources read 4 Oct 2026
If your partnership agreement doesn't say otherwise, partners share profits and losses equally, get no salary for working in the business, and all have a right to take part in managing it. A new partner can join only if all existing partners agree.
- Where
- Between the partners; disputes go to the High Court (or Magistrate's Court where partnership assets are KSh 300,000 or less)
Steps
- Split profits and losses equally unless you have agreed a different split.
- To change these default rules, put different terms in your partnership agreement, or get all partners to agree.
- If a dispute can't be settled, any partner can apply to the court, which can remove a partner or break up the partnership.
Watch out
- By default no partner gets a salary for working in the business, even one who does most of the work.
- Ordinary business decisions are made by majority vote; other matters need everyone. Partners can't change this rule by agreement.
- Capital you put in earns no interest, but a loan to the partnership beyond your capital earns 3% a year where economic circumstances permit.
Who this covers
- People carrying on business together to make a profit (an ordinary partnership), even without a written agreement
- Agreements made by conduct count too, not just written ones
- New partners, who can join only with every existing partner's consent
Official sources (1)
- Partnerships Act, 2012 (No. 16 of 2012) new.kenyalaw.org · read 4 Oct 2026