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If the partnership deed is silent, are partners entitled to receive interest on their capital?

Answer and explanation

Correct answer: No — Not payable

When the partnership deed is silent about interest on capital, interest is not payable by default. Interest becomes payable only if the deed provides for it or if partners subsequently agree to pay it. Option C is a common confusion — partners can agree later, but silence in the deed does not create an automatic right. Exam tip: check the partnership deed first; absence of a clause on interest means no default entitlement to interest on capital.

Related tags

Partnership AccountsInterest On CapitalPartnership DeedProfit DistributionAccountancyPartnership Accounts Basic ConceptsClass 12 Mcq

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