Making Sure Your Business Is Playing By The Rules
When you run a small business, you have to adhere to a lot of rules and regulations to make sure you’re running everything properly and according to the law. Diving head first into a new start up can be fun. You can feel inspired and have a lot of enthusiasm to get started. But don’t run before you’re walking!
You need to lay proper foundations so your business can prosper and profit without coming into trouble and facing fines and potential court cases, which could ultimately shut you down.
Here are a few steps you should make sure you take when you first start out and expand!
Registering Your Business
First things first, you’re going to have to officially register your company. There are a number of different types of company registration out there, and the one you ultimately opt for will largely fall down to your personal preferences and how you’d prefer to arrange your business.
Forming a limited company will allow you to keep your business as a separate legal entity to you. This process is also referred to in different ways – some people will call it company formation, others will refer to it as company registration or company incorporation.
Try not to get confused with the terms as they all basically mean the same thing. When you form your company as a limited company, you undertake a process that ensures all money, property, assets responsibilities and agreements purchased by, owned by, or agreed by your company are legally separate from your own finances and your own belongings.
This essentially means that if your business faces trouble and items start being repossessed to recover costs, only assets, money and belongings of your business can be taken – not your personal home, personal vehicle, or other personal assets.
Paying Your Taxes
Every profit making business needs to pay taxes. But chances are, if you’re a first time business owner, you may not have had to deal with taxes before. Generally speaking, the majority of people are employed and this means their employers take tax and other necessary costs out of our salaries before they’re paid into our bank accounts.
Matters of tax are dealt with on our behalf and not something we even have to consider. However, when you run your own business, you take on responsibility for paying your personal taxes and your company taxes. Accounting can prove pretty difficult and end of year self assessments and tax returns can be extremely complex. This is why many of us hire accountants.
This step is highly recommended. After all, an accountant knows the ins and outs of all of the systems. They can ensure you pay the right amount of tax and deal with any deductions, such as expenses, on your behalf.
Making Sure You Have the Right Licences
Some companies need specific licenses to operate. Cannabis dispensaries, for example, need a licence to sell cannabis. Whatever licences you need, consult specialist companies (for this example, https://www.cannabisconsultingnationwide.com/ would be a good place to start). Then you’ll be able to make sure you have everything you need to operate legally!
Familiarising Yourself With Employment Law
If you’re going to take on employees, you’ll also find you take on a whole lot of responsibility over their wellbeing at work. This only makes sense – these are the individuals generating the majority of the profit you’re taking home.
So, make sure to familiarise yourself with various aspects of employment law. Some areas you should really focus on include:
- Employment Contracts
- Termination of Contracts
- Equal Pay
- Minimum Wage
- Working Hours
- Sick Leave
- Annual Leave
- Maternity and Paternity Leave
The minimum wage that each of your employees is entitled to will vary depending on their age and whether they are an employed member of staff or an apprentice.
Either way, there are laws in place that ensure all employees are paid a basic wage. This is referred to as “minimum wage” and varies from country to country. So, look up rules in the area your business is operating in and make sure everyone’s being paid at least the minimum wage they are entitled to.
You cannot discriminate against any of your staff. There are a list of protected characteristics that you need to respect. These include age, sex, gender, sexual orientation, religion, ethnicity, marital or civil partnership status, pregnancy, or being or being a transgender person. Never treat any of your staff differently based on discrimination against these aspects of them as people.
Almost all workers are entitled to “annual leave” – otherwise referred to as “paid holiday”.
Make sure every staff member is aware of their entitled allowance so they can arrange their leave over the course of the year. The average amount of holiday that workers are entitled to when working a full time position is 5.6 weeks of paid holiday leave a year. Part-time workers will not be entitled to as much, but they will accrue hours too.
As an employer, you have a duty of care over your employees. If you fail to adhere to your duty of care, your workers can file negligence claims against you. Their claims can range over a variety of areas, but common claims focus around physical harm that they have been subjected to, emotional or mental harm and damage to their personal property. In short, avoid this by taking care of your employees and by following necessary precautions to remove potential hazards from their work life.
Look up the working time directive. This may also be referred to as working time regulations.
Legally, you cannot push your staff too far. They need rest and they need time to pursue their own lives outside of work. In most places, your employees do not have to work more than 48 hours a week on average. If employees want to work more than these hours, they can opt out of the directive and work more, but this has to be a personal choice that has not been pressured or influenced by you.
These are just a few areas you need to adhere to in order to ensure your business is playing by the rules and not causing damage to others. Follow the rules and everything should go swimmingly. It’s when you start straying from the straight and narrow that your business can begin to suffer!
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