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If the partnership deed is silent on drawings, will interest on drawings be charged?

Answer and explanation

Correct answer: It will not be charged

Charging interest on drawings is a contractual matter determined by the partnership deed or by agreement between partners. If the deed is silent, interest is not charged by default. Partners can later agree to charge interest, but it does not apply automatically. Option C is a close distractor—mutual consent can create a valid charge, yet it is not the default rule. Exam tip: always check the partnership deed first; when the deed is silent, answer ‘no’ unless an agreement is shown.

Related tags

Partnership DeedInterest On DrawingsPartnership AccountsAccountancyPartnership Accounts Basic ConceptsClass 12 Mcq

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