Is it necessary to have a written agreement before starting a business partnership?

While not strictly legally mandatory to have a written partnership deed, it is very strongly advisable, even between close friends or family — a written agreement clearly documents each partner's capital contribution, profit-sharing ratio, roles and responsibilities, and, importantly, what happens if a partner wants to exit or if a serious disagreement arises.

Without a written agreement, disputes down the line (and unfortunately, business partnerships between friends do sometimes sour) become considerably harder to resolve, since there's no clear, agreed reference point for what was actually intended.

An unregistered partnership firm also faces certain legal disadvantages — for instance, restrictions on its ability to sue third parties to enforce contractual rights — so beyond just having a written deed, registering the partnership is generally worthwhile too. It would be a sound investment to have a lawyer help draft a proper partnership deed before you formally begin operating the business together.