SMEs / Starting Up A Business: So you have had a light bulb business idea.... what do you do now?
When you are investing all your time, sweat, tears and savings into a new business venture and getting little in return - save for an adrenaline rush and increased debt - you don't want to be grouped with the vast majority of start-ups that fail within the first 5 years. To ensure this doesn’t happen we have compiled a list of things to consider and implement before you are full operational as a business.
Which Business Legal Structure to choose?
- Limited companies are legal entitles in their own right.
- As a shareholders of the Company, your liability is limited to the capital you put into it (unless you are also a director and you have given a directors/personal Guarantee, then you liability will increase).
- All limited Companies have to be registered with Companies House.
- The Directors are bound by strict legal obligations, such as filing audited accounts.
- You and your partners are personally responsible for debts and obligations.
- The Partnership is not required to prepare formal documents, namely accounts, but most partners see the benefit of doing so.
- You pay tax on your drawing.
This is the simplest form of setting up in business.
A sole trader makes all the decisions and runs the business however, is also solely responsible for all debts, liabilities and obligations.
see more information on business structures here
Research what insurance you need in place, examples include; Employment Liability Insurance, Public Liability Insurance, Professional Indemnity Insurance, Equipment /Asset Insurance.
- Open a bank account.
- You will need a payroll system if you are employing staff
- Register for VAT registration – there is a legal requirement to register for VAT with HM Revenue and Customers if your businesses VAT taxable turnover is more than £83,000.
- Decide how you will deal with invoicing your customers, do you need a cashier?
Term of Business Before you commence taking on obligations such a providing goods and services, you must have your terms clearly drafted so your business is protected. The Terms act as a legal business contract between you and your customer/clients.
It is essential that you regularly review your Terms and Conditions. If they aren’t working for your business, if they are too complicated for your customers to understand or if there has been legislation or regulatory changes in the law then amend them! find more on Terms of Business and other legal drafting here.
Employment & Consultancy Contracts
Do not fall into the trap of thinking because you are giving a friend a job /role in your new business your friendship will be unaffected. Protect your friendship, and your business, by clearly setting out what the obligations are for both parties
These are the bare minimum any new business needs to have in place before it starts touting for business and employing personnel.
Our employment law services can be found here.
Seek advice on any legal; policy documents, or procedures you need in place and if there are any Regulatory Bodies you need to register with, for example; Date Protection/Information Commissioners Office.
Check out more of Regulatory Services here
Protect Your Brand
Your intellectual property includes the name of your products or brand, inventions, designs along with any written text and photographic images. Take steps to protect your intellectual property by registering trademarks and copying your creative work.
Walker Rose Solicitors provides astute legal advice and the drafting of legal agreements, polices and documents to address your immediate and on-going business needs.
We can assist, negotiate and draft agreement terms with the co-founders, investors, employees, suppliers and customers.
We can assist whether you are a new start-up or an established business. We work for you to design ‘best practice’ doctrines ensuring and securing a smooth running and efficient workplace.
Walker Rose Solicitors provide sensible commercial legal advice and draft the agreements you need in place to reduce areas of dispute or at least provide a mechanism for the parties to resolve a dispute. We can help you grow and evolve safe in the knowledge that you, your business and your brand are protected and stand on a strong legal ground to move forward.
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