The division of net income for a partner should be disclosed. The net income is the money received by the partner and divided by that, after deducting amounts for taxes and commissions. Partnerships and companies are required to disclose their financial status. Although it is mandatory to disclose this information in partnership agreements, it is sometimes a violation of contract and they should make sure that what they disclose is true and correct.
In any case, you absolutely need to disclose this information upon setting up a partnership/company. Many would argue that this would also be the most reasonable way to begin a new relationship, and without the right advice from an experienced attorney with a sound knowledge in these matters. In the case of a partnership, you need to understand that the business needs for a partnership are different to a corporate entity.
This is a perfect example of a disclosure that may not have been considered very important until recently. Let’s face it, when the division of income is disclosed one partner’s income may not be the same as what it is disclosed to be when a legal partnership is created. Many people might only be familiar with the division of income as an expense deducted from the other party’s account.