Small business owners or entrepreneurs may be so busy growing their enterprises that they are quite unaware of the essential legal aspects of running a business. In the fallout from Covid-19, most businesses are now subject to quite a few new legal implications. They should look into these to avoid lawsuits or legal trouble in the future. Here are a few essential legal tips that any small business owner can use to protect themselves. This could be from liability or trouble with the law. These tips will also help protect what you have built from problematic scenarios.
While your business may have started from your apartment or garage or initially been a passion project, when it is fully up and running, you need to be registered on paper. Ensure you do this with the relevant authority in your city or state. There are a plethora of benefits to registering your company officially. The first is undoubtedly the effect it has on potential and existing clients. Clients or customers are more likely to choose your business or stick with it if they know you are legally registered. This shows you are serious about the product or service you provide rather than operating it as a seasonal hobby. The other perks you are likely to enjoy with registration is that you can apply for business bank accounts or even get capital loans if you are looking into expansion.
Regardless of the nature of your business, make a point of having properly and legally verifiable contracts. These should be with all suppliers, manufacturers, partners, and even clients (if your business is more service-oriented). Contracts with clear terms and conditions go a long way in protecting you from unforeseen incidents. They also protect you from being legally liable in case things go wrong. Have an attorney on retainer. Or, if that isn’t in your budget, at least have an attorney on your speed dial to help you every now and then in deciding on contract terms. Beware of handshake deals or deals made purely on mutual trust. In today’s fast-paced world they rarely hold up and people can often let you down.
Once you have defined the nature of your business (limited liability business, corporation, etc) make sure you fill out and submit the relevant articles of organization your country or state requires. Bookkeeping, paying taxes, obeying labor laws, and getting permits will be a lot less complicated if you do.
Intellectual property such as a concept or idea, software, or even artwork that represents your branding, logo, or ethos is all yours to protect. These are often the lifeblood of a new business. They may even count more than your physical or capital investment! Know the intellectual property laws of your country or state. Wherever possible consult a lawyer about obtaining legal protection for your ideas. While you may not need an Orlando criminal defense attorney, you will require an attorney nonetheless. Especially, to guide you through everything from contracts to registering trademarks.
Owners of small businesses may use their personal bank accounts at the beginning. This can be for for capital investments, day-to-day running expenses, profit, and loss statements, and payments on personal loans. However, as your business becomes official you need to open separate (or several) business bank accounts. These should have no personal transactions present in them.
From an essential legal standpoint, if someone sues you and your business does not have a bank account, your personal funds may have to pay for damages. Budgeting, tax deductions as well as analyzing weekly or monthly cash flow is a lot easier with a separate bank account. If clients or customers need to pay you online through card or bank transfers, having a business-only account is both convenient and sensible.
Covid-19 changes things for the foreseeable future in terms of business operations worldwide. As such, it is essential to follow legal guidelines. Thereby, as a small business owner, you need to check a few boxes when it comes to handling employees. You must also protect yourself legally with regard to standard protocols against the virus. Especially, as they relate to clients and customers.
Check with your insurance provider (if you have taken out insurance) regarding coverage for business disruption, employee protection, and treatment. Also, consider other loss of profit coverage wherever applicable. You may also need a legally binding waiver agreement that all employees sign so that they follow the standard protocol. This ensures your business is not liable in the eyes of the law in the case of illness.