How to avoid legal pitfalls and get new businesses off to the best possible start
Starting out in business is daunting and most start-ups will want to focus on building the business and bringing in money. However, it is important to take the right legal steps at the beginning to avoid time-consuming and expensive issues later.
This short checklist is designed to help businesses mitigate the legal risks and achieve commercial success. • 1. Legal structure: You need to choose the right legal structure to suit your circumstances and ambition. You can set up as a sole trader, partnership or company.
This is one of the most important decisions you will make from the outset.
Sole trader: Runs his/her own business as an individual, is self-employed and personally responsible for any losses the business makes.
Partnership: There are different types of partnership, but this can be a relatively simple way for two or more people to run a business. You will need a partnership agreement to set out how decisions will be reached, how equity is divided and assets split up at dissolution.
This checklist emphasises the importance of getting the right legal advice from the outset so that your business is efficiently structured to grow and succeed. Catherine Cooney, partner in corporate, commercial and charity law with Worthingtons Solicitors, advises businesses and charities on a daily basis. She regularly advises on setting up new businesses, mergers and acquisitions, restructuring, drafting shareholder agreements, drafting and negotiating of contracts, advising on governance and commercial leases. For advice, please telephone 02890279500 or email firstname.lastname@example.org