Giving up a comfortable job to establish a new career is tough, but one that holds inexplicable appeal for an entrepreneur. In the initial stages, when you are full of motivation and zeal to give shape to your ideas, you probably look at every aspect of your venture through rose-tinted glasses. However, with time and experience, comes the realization that there are some harsh realities to confront and of these, one of the foremost is the legal aspect of running a business.
Although it is not expected that an entrepreneurs have to be experts of law, here are five laws in which individuals should be aware of before building a new business.
Whatever the nature of your business, it involves financial transactions. This means you ought to be familiar with the laws governing these. An error in tax calculation or payment will result in a penalty, and recovering from the loss of credibility can be difficult. Whether it is the sale of assets or the capital gains tax, understanding the legal aspects governing your accounts is something no entrepreneur can afford to ignore.
Patent and Copyright Laws
If your business involves the use of intellectual property, you ought to get familiar with the terminology of patent and copyright laws. Nothing can damage your financial health and reputation as badly as copyright and patent infringement. A working knowledge of intellectual property rights will help you avoid plagiarism as well as protect your ideas from being poached by others.
In businesses that hire permanent staff, it is vital you spend time understanding the basics of employment laws. A few of these basics are what duties you can expect of your employees, the rights they have, and the facilities and insurance you ought to provide them.
Whether you buy, rent, or lease the premises out of which your business functions, it is important to know the laws governing real estate. If you are purchasing property, you need to get a warranty deed to safeguard you, the owner, against encumbrances. If you plan on constructing a building for your use, it is vital you understand the nuances of residential and commercial zoning restrictions.
One of the best ways to safeguard your business from unexpected losses is to ensure you have sufficient insurance. Whether it is property insurance to cover your office and the equipment or stock you carry, or workers compensation insurance to cover an inadvertent injury to an employee during work hours, knowing the basic tenets of insurance laws is important to ensure you get the right level of coverage.
Knowledge of these laws is of great value, but unfortunately, not many entrepreneurs pay attention to these aspects. Without a clear awareness of the law surrounding creating a new business, individuals may end up losing a great amount of time and finances on a faulty business. If copyright laws are broken, not only could a newly formed business be shut down, but also an individual’s reputation could be tarnished for a good amount of time. If business owners fail to become knowledgeable of employment laws, they may find themselves on the wrong side of a dangerous lawsuit. Without an understanding of property laws, newly formed businesses may face eviction, loss of finances, and lose the trust of potential lifetime customers.
About the Author: Daniel Adler is a writer who creates informative article related to the field of law. This article describes a few laws entrepreneurs should be aware of and aims to protect the legal rights of individuals just like Cal Western’s California Innocence Project. Please find out more.