How this usually works
A good accounting process for partnerships starts with a short review: ABN, TFN and GST status; payroll needs if you have staff; the partnership agreement and profit‑share ratios; your software file (Xero, MYOB or QuickBooks); and any looming BAS or tax deadlines.
Work then breaks into three layers:
1) Immediate triage. Fix overdue BAS or payroll issues, catch up bank reconciliations, and confirm partner drawings versus expenses. If needed, set up PAYG instalments and lodge a plan with the ATO.
2) Process design. Configure the chart of accounts, partner capital/current accounts, receipt capture, bank rules and month‑end journals for profit allocation. Align GST method and payroll with STP and super for employees.
3) Ongoing review. Monthly or quarterly checks, BAS preparation, management reports and year‑end delivery of the Partnership tax return (Form P) and partner distribution statements.
Australian context to keep in view
- Partners don’t draw wages from the partnership. Drawings reduce partner current accounts; profits are taxed to each partner personally.
- Register for GST from $75k turnover and use a BAS agent for accurate activity statements and ATO timing. See: BAS agent services.
- If you hire staff, you need payroll, STP, superannuation and workers compensation set up. See: Payroll services.
- Use a registered tax agent for Form P and partner returns, and to plan PAYG instalments and small business concessions. See: Tax accountant.
- Track partner loans, capital contributions and changes to profit‑share inside your software to keep the agreement, ledger and tax return aligned.
What to compare before you commit
Scope
Confirm it includes bookkeeping, BAS, payroll (if applicable), the partnership tax return (Form P), partner distribution statements and help with individual partner tax where needed.
Software fit
Look for clear experience with Xero, MYOB or QuickBooks and the ability to set up partner capital/current accounts, profit journals and receipt capture end‑to‑end.
Turnaround and communication
Ask about response times, month‑end cadence, BAS lodgement dates, year‑end timelines and how urgent ATO items are escalated.
Commercial fit
Compare fixed‑fee versus hourly pricing, what’s included (BAS, meetings, software), and whether you want compliance only or advisory support as you grow.
Best next steps
Write down the outcome you want: catch up BAS, clean books, set up payroll, fix drawings, improve reporting, or complete the partnership return with no surprises for either partner.
Shortlist providers against that outcome. The right fit can explain how profit allocation will work, set a BAS and year‑end timetable, and show you the software workflow in plain English.
Use these pillars if you’re comparing options: Small business accountant, Accounting services hub, Comparisons, or head to the form to outline your partnership.
Frequently asked questions
What does an accountant do for partnerships?
They review or set up registrations (ABN, TFN, GST), design the bookkeeping workflow, prepare BAS and PAYG instalments, handle payroll for staff, complete the partnership tax return (Form P), and produce partner distribution and capital account statements that flow into each partner’s individual return.
Do partners take wages?
No. Partners don’t receive wages from the partnership. They take drawings and are taxed on their share of profit. Payroll, STP and super apply to employees you hire, not to partners.
What should we set up first?
Obtain a TFN and ABN for the partnership, register for GST if turnover is $75k+, choose software (Xero/MYOB/QBO), open a dedicated bank account, and document the partnership agreement with profit‑share and decision‑making rules.
When should a partnership switch to a company?
Consider a company when you want different profit distribution rules, to retain profits at a company tax rate, or to support higher risk or growth. An accountant can model the tax and legal differences before you change structure.