#1 Legal Tips for Startup Entrepreneurs
Taking the plunge to start a business of your own is easy. But making it a success is a different game altogether.
Many-a-times it is seen that start-up entrepreneurs end up getting entangled in a lot of legal mess while trying to make a success of their venture. If you are a start-up entrepreneur, it’s wise to take precautionary measures at the very onset so that you don’t end up in such a position in the first place.
Outlined below are a few essential legal tips that can help you to have a smooth run in your startup journey.
#2 Go for a Written Founders’ Agreement
As a first step, go for a written agreement amongst the founders. Try not to incorporate until your business shows signs of picking up speed and the revenue starts to stream in.
Also, be clear about the tax liability of the venture. This is a very important part of your business and you need to make a clear decision about it right at the start.
#3 Have all the Business Licenses in Order
Almost all businesses require some kind of licenses to run them. Some licenses may be related to tax registration while others may be about company registration.
Depending on the type of your business venture, you may also need trade license, employment registration, and establishment registration among others. Not having the proper licenses to run your business may land you in a legal soup.
Sooner or later, you will have to bear the consequences of your ignorance in the form of costly lawsuits and fines. To avoid such hassles, make sure that all your business licenses and permits remain in order.
#4 Pay attention to the accounts and taxation part
Negligence and ignorance about accounts and taxation have landed many start-up entrepreneurs in severe trouble, including hefty fines and criminal cases regarding tax bill payments.
As a founder of a business, it is your responsibility to ensure that the accounts and taxation part of your business can withstand any scrutiny.
As long as your business is too small to come under the umbrella of taxation, you are safe. But as your business grows, this scenario will change. So, it’s better to remain prepared beforehand than to face the consequences later.
#5 Gain knowledge about the vendor contract laws
Sometimes startup entrepreneurs enter into vendor contracts at the early stage of their business that turns out to be a pain for them later on.
This often happens because such entrepreneurs overlook or fail to look at the hidden clauses in the contract. If your vendor contract has a clause that you fail to identify, it can trigger various kinds of unpleasant legal situations in the future.
When you start your business, you are likely to enter into countless vendor agreements as your business grows. The best idea is to gain sufficient knowledge about the vendor contract laws so that no one can take advantage of your ignorance and land you in a pitfall later on.
Author Bio: This post has been contributed by Missy, who is a super connector between Outreach company SubmitCore and finance readers.