What to consider Legally when starting up your First Money-Making Business
When you start a money-making business, there are a couple of legal things to consider that you need to observe before you can start operating. Below are the legal considerations you need to adhere to when you start your first money making business.
Choose a Business Structure
When starting a business, one of the first things to do is to decide which business structure suits your business. Here are the most common business structures that you can choose from:
- Sole proprietorship – if you are looking to operate and manage your business on your own.
- Partnership – if you want to operate and manage your business together with one or more partners.
- Corporation – if you want your business to be a separate entity from your personal assets.
- Society – if you are operating a non-profit organization and all of its funds are to be used for the benefit of the society only.
- Co-operative – if you want to operate a business that is owned and managed by a group of people who use and benefit from the business.
Choosing the best business structure for your business is essential. It affects how you will manage your business. It also has implications on how you pay your business tax and record your financial accounts.
Although you can change the structure of your business, later on, doing so can be very costly. This is why you need to choose the business structure that suits your business carefully. Consult with your attorney or your accountant, if you are having trouble deciding which business structure is the right one for you, consult with an attorney or an accountant.
Register Your Business
Before you can start your business operations, you must first register it to make sure that it is legal. Registering your business is important because you will need it to open up bank accounts, applying for business loans, and many other business start-up activities.
Here’s how to register your business.
- The first step of business registration is to submit your business name request to gain approval. Business name approval is essential to avoid confusing or misleading your customers. It also provides a proof to the public that you are the rightful owner of the business. Your business name will be checked to ensure that there is no duplication.
- Once your business name is approved, you are given a specific amount of time to register your business name and complete the registration process.
Secure the Licenses or Permits For Your Business to Operate
Depending on your chosen business structure and location, the law will require you to secure a couple of business licenses and permits from the local, state, or federal authorities.
These licenses may include the following.
- Basic business operation license
- Business name permit
- Fire department permits
- Permit to operate
- Zoning permits
- Sales tax license
- Health department permits
- Occupational permits
Know Everything You Need to Know About Employment Law
When starting a business, you also need to learn about employment law. Part of your responsibilities as the business owner and the employer is to look after the welfare of your employees and it will immediately start as soon as you get your first employee.
You should talk with an attorney who specializes in employment law to learn all about your legal responsibilities as the employer which includes:
- Payroll
- Self-employment tax
- Anti-discrimination policies
- OSHA regulations
- Unemployment insurance
- Workers’ compensation rules
- Work hour requirements
Register for Trademark Protection
Even though the law doesn’t actually require you to request for trademark protection, you may still want to protect your brand name or logo especially if you are looking to introduce something new to the market.
- You don’t want other businesses to use your brand name or logo as their own as it might damage your brand and your business reputation.
- Registering for trademark protection can help you recover your business properties especially if someone has used your business name as their own.
- Having trademark protection means you are the only one who is allowed to use your business name.
Ensuring Health and Safety
One of the most important things to do when starting your first money-making business is to ensure the health and safety of the workplace.
- Business owners and employers are legally required to make sure that their employees are working in a safe environment.
- This legal obligation is not only limited to employees but to customers or other people who are inside your business premises.
- “Safety” isn’t just limited to making sure products and services are safe. In terms of products, defects and malfunctions have to be accounted for. In the case of a business related to car maintenance, a lawyer versed in specific product defects such as tire failures – which you can also find in this site – can be helpful in making sure there are protocols for these situations.
Follow These Tips and Start Your Business
Starting your first money-making business is a big achievement. Registering your business, securing permits and licenses, and abiding by the rules and regulations of the employment law may not be the most exciting things to do when starting out a new business, but they are essential to get your business started and help you steer out of trouble later on.