The startup driven by entrepreneurs can be termed as successful only when they are focused on building smart solutions to deliver the best to the customers. While it is essential to stay on the track with the market and the customers. It is equally important to gain understanding about the rules and regulations and the basic laws that apply to the smooth functioning of the business. Several startups turn to the online legal service in a bid to save money although they are only viewed as the possible pitfalls that these companies should rather avoid to ensure that the business is legally in a sound position.
Way to move
Starting a business is a challenging pursuit, and you have to weigh the legal ramifications against which you want to protect the business. As a business owner, you want to make sure that you have covered all the legal parameters properly and ward off the inexorable fines and fees or even the worst which is to land in jail. There are plenty of startup legal services in India for the businesses to avoid such hassles and hiring one can guide you when it comes to following the right steps. Read the following checklist to know the legal issues that every startup should know from the scratch.
Creating a formal business structure
The first thing about which a business needs to stay clear is its type and the nature. You must know whether it is a private or public limited company, sole proprietorship, limited liability partnership, or partnership. You must get clarity about this from the start as it is integral to the functioning of the business and for you to experience ease while sketching the long and short-term goals. Each type of business needs to cater to a set of legal requirements and need to pay special attention to this aspect before it becomes fully functional. Another thing that startups need to consider is whether to raise funds from the public. A private limited company is the best option to bootstrap the business as it offers the flexibility to manage the internal stocks of the company and the external investments.
Checking the issue of registration and license
Depending on the type of business you own, you must apply for the business license of that country. However, you have to check the requirements of the state in which you own the business. The registrations, licenses, and permits come in different variations. The permits also differ according to the industry, so you should consult the startup lawyers in India to know whether your business is compliant with the law.
Familiarity with the accounting and the taxation laws
For every business, taxes are an integral aspect and there is a lot to handle right from local, state and central taxes. The businesses and their operating sectors attract taxes, and knowing them in advance can help the startup to stay prepared. Similarly, the companies should also know about the tax relief options and exemptions that are launched as part of the initiative to promote the startups. On the other hand, the businesses should maintain their books properly and keep them updated which ensure that the new business entity follows the rules of accounting as well. Often small businesses do not pay proper attention to good accounting practices and ignore the regulation which take very less time to flare up later resulting in serious discrepancies. When you need to register a file for multiple taxes, it is best to hire an accountant or a tax advisor to make sure you are through with the tax laws.
Legal problems with the employees
Every business needs to restrict the liabilities before hiring new employees. Typically, the startup must design an employee handbook to ensure that the employees joining your company sign the acknowledgement that they have received the handbook. The handbook must address the legal disruptions arising within the company such as dress code and the policy against sexual harassment. The legal services for startups deals with a multitude of these cases every year so you should stay alert from the beginning.
Signing written agreements between the owners
If your business operates with more than one owners, make sure that each individual is aware of their rights and responsibilities related to the business. which in turn depends on the business structure. Getting legal help from a startup lawyer in India is a must to ensure that the articles of incorporation and the shareholder agreements are sound.
Understanding of labor laws
A startup must adhere to the labor laws as they are important to every organization whether big or small. The moment you establish the company and hire employees, your business is subject to the labor laws. The laws related to the payment of the PF and bonus, minimum wages, gratuity, maternity benefits, and weekly holidays are to be complied with to avoid disputes. It is best to consult with startup legal services to find out more about the applicability of the labor laws and to ensure that the startup is legally sound.
Protection of the intellectual property
Whether you have a tech-centric business or otherwise, it is important to protect the patents, trademarks, designs, and the copyrights and file the patent as early as possible. It will not only help you protect the IP, but also make it attractive to the investors.
The final take
It is essential for every startup to adhere to the legal requirements. The knowledge of the basic laws and the matter of compliance are significant factors that ensure smooth business operations. The best you can do is to hire a legal service to stay afloat with the compliance issues and get advice to ensure that your company is legally safe.