Legal Issues Around Forming A Business

November 30, 2018 8:49 am

Running your own business can be incredibly rewarding. You can control when you work and allows you to do what you want to do. However, there can be some legal issues around forming a business and being aware of these will help ensure you run your business as smoothly as possible.

The name

It sounds obvious. Unfortunately, the wrong name can create massive issues. A quick check online will help ensure that you do not pick the same name as another local company, or at the very least you can adjust it so it is clear that you are offering something else. This is also equally true when it comes to products.

Structure

Another aspect to think about is the structure. You may want to start off as a sole proprietor or you may want to create a partnership. The advantage of this is that there are fewer responsibilities than with a limited liability company. The disadvantage is that in this instance you would be personally liable for any debts.

With a partnership, it is recommended that you draw up a written partnership agreement. You may feel that you can trust a friend or family member when you go into business with them, but it is still better to have a clear agreement written down in the event of any potential issues (for example, who gets what if you choose to sell the business).

A limited liability company has less restrictions than a corporation, but there is more protection than you would get under a sole proprietorship or partnership.

Licensing

Most people know that if you want to sell alcohol, then you need a license. What you may not know is that some software packages require licenses as well. You need to check this so that you are not legally liable as it technically means you are breaking the law. Furthermore, illegal versions of software packages are more vulnerable to hacking and data breaches.

Insurance

Insurance is another cost that people do not consider. Let’s say that you want to run a pop up shop selling memorabilia. Even if it is just for a day, you need to have limited liability insurance. If you are in a mall or shopping centre, there is the chance that their insurance may cover it. However you need to check this or you could be liable for the costs if someone is injured on your premises.

Health and safety

If you have more than five employees then you need to write down your risk assessment. This includes identifying any potential hazards, who could potentially be harmed, precautions you need to make, record any significant risks and to review the assessment (updating if need be).

We can help

For startups and small businesses, dealing with all these issues can seem intimidating and overwhelming. Fortunately we have legal representatives on hand who will be able to go over your requirements and help you organise your business accordingly. For more information and to discuss your needs contact Larcomes today and we’ll put you in touch with one of our specialists.


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