Your Business And The Law
Running a small business can be a legal mine field, and without appropriate knowledge and understanding of the relevant risks involved, you can quickly find yourself in some difficulties. Running a business without consideration for the law can be dangerous, particularly when considering the potential financial and even criminal risks you may be running. That’s why it’s a good idea to have an idea of the relevant legal provisions that may apply to particular circumstances in order to understand where you might be personally liable, and how you can avoid incurring such liability when managing a small business.
The first thing to bear in mind is that a business has its own legal formalities relating to the particular business form you choose. For example, running your business as a sole trader will require very little in the way of natural legal formalities, other than that you file appropriate tax returns annually and keep appropriate records of your financial transactions on a daily basis. This burden is far stricter if you choose to operate as a limited company. If you do decide to go down this route, it may be worth investing in a book on basic company law for reference. Don’t take the risk and try to muddle through; it’s better to know what is expected of you and what the penalties are by getting some form of expert opinion.
Secondly, you may face liability if you cause injury, either financially or physically to another party in the course of running your business. It is advisable therefore to opt for decent insurance coverage to protect against eventualities of this nature. Another good idea is to include an exemption clause or disclaimer whenever you can, although it’s important to understand these aren’t watertight. What they can do is limit your liability in damage to physical property where it is reasonable to do so, and in no way can they limit any liability you may have for anything deemed unreasonable or anything relating to a physical injury or death. Read full article.
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