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Partnership Profit Analyzer

For a landowner and a cash partner building together: profit split, taxes, each side’s return in today’s money, and whether building beats selling the plot now.

Building beats selling the plot by

PKR 2,787,228(27.9 lac)

for the landowner, in today’s money

Landowner: sell today

PKR 19,100,000(1.91 crore)

after PKR 9 lac CGT

Landowner: build & partner

PKR 25,942,857(2.59 crore)

PKR 2.19 crore in today’s money

Cash partner profit

PKR 4,457,143(44.6 lac)

29.7% total · 18.9% p.a. · real 6.2% p.a.

Project profit

PKR 10,400,000(1.04 crore)

gross PKR 1.30 crore − tax PKR 26 lac

Fairness check

Capital put inLandowner 57.1% · Partner 42.9%
Profit receivedLandowner 57.1% · Partner 42.9%

Simplified: CGT is charged on the plot gain if sold now; selling a completed project also carries withholding, transfer and agent costs not modelled here. Get the agreement reviewed before signing.

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The short answer

In a landowner–builder partnership the landowner contributes the plot and a cash partner funds construction; after sale, profit (sale price minus total capital, less tax) is split by capital contributed or an agreed percentage. The analyzer also compares this with the landowner simply selling the plot today after capital gains tax.

How the partnership is analysed

  • Capital = plot value (landowner) + cash put in by each side.
  • Gross profit = expected sale price − total capital.
  • After-tax profit = gross profit − tax on project profit.
  • Split = by capital contributed, or an agreed percentage.
  • Selling today = plot value − capital gains tax on the gain since purchase.
  • Today’s money — the landowner’s outcome is discounted at your chosen rate over the timeline, so building and selling now are compared fairly.

The fairness check shows each side’s share of capital next to its share of profit. A split far from the capital shares should be justified by something else — expertise, risk, or management effort.

Before signing a partnership

Put the contribution, timeline, cost overruns, sale authority and exit terms in a written agreement reviewed by a lawyer. Taxes shown are simplified; selling a completed project also carries withholding, transfer and agent costs.

How to use the partnership profit analyzer

  1. 1Enter the plot’s value today and what it was bought for.
  2. 2Enter the construction cost, expected sale price and each side’s cash contribution.
  3. 3Choose a split by capital or an agreed percentage.
  4. 4Set tax rates, discount rate, inflation and the timeline in months.
  5. 5Compare the landowner’s outcome with selling today, and the cash partner’s return.

Frequently asked questions

+How is profit split in a construction partnership?

Commonly in proportion to capital contributed, with the plot counted at its current value. Any other split should be agreed in writing.

+Should I sell my plot or build in partnership?

Compare the after-tax amount from selling today with your share of the project in today’s money. The analyzer shows the difference.

+Is capital gains tax charged on selling a plot?

Capital gains tax may apply to the gain on disposal depending on the holding period and current law. Check the rate that applies to you.