4 Ways to Keep Your Business Legal
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Small businesses make up 99.9% of all companies in the United States. The definition is any with 500 employees or less. When you open your business, you'll be a part of this statistic, and the government will make sure it's being run legally.
You need to take the steps on having everything in order before opening. This will save you trouble in the future, and you'll feel great operating an honest business. We're going to go over some things you should be doing to keep your business legal.
Pay All Taxes
Any income you make with your small business, you'll need to pay tax on. For every country, the percentage is different, so you'll have to look at the specific rules for your business.
In addition to income tax, there could be other payments due. In Canada, when you buy the building for your office or store, you'll need to pay a land transfer tax. If you're not sure whether you've paid this or have more questions, visit the blog here for more information.
In the United States, when you have employees, you'll need to pay an employment tax and income tax. Make sure you fully understand what you owe to the government to stay a legal business.
Get All Licenses
Certain occupations require a license to operate rightfully. It's your responsibility to obtain these and keep them up to date. You can get into some legal trouble if you're working with an expired license.
If you sell liquor, are a lawyer, contractor, electrician, therapist, or drive large machinery, you and your employees will need to be qualified. Before opening up for business, make sure everything is finalized.
You should display your licenses in a visible spot in your office or store, so your customers know you're legal. Also, if an inspector comes in, you'll have all the appropriate documents.
Have Everything in Writing
You want to record all business transactions, receipts, contracts, agreements, and anything else in writing. This will help you stay organized, and if there are any problems, you've got written documentation.
As humans, we want to trust others, but when dealing with your business, you need to think twice. If you've put all of your life's savings into it, you don't want to lose it all over a word of mouth deal.
Also, if you get audited or sued, you have everything organized already. It's a good idea to digitize the documents, as it's easier to keep track of. It will show those you do business with that you're serious about your work, and they'll respect you as an owner.
Have a Lawyer
You should always have a lawyer to work with you on your business transactions. They can double-check you're filing everything correctly and operating legally.
Your attorney can give you inside tips, and you can ask them questions when they arise. They can help you notarize paperwork or be a witness for signing agreements.
The Bottom Line
When you start a small business, there's a lot to do, but one of the most important things is to make sure you're operating legally from the beginning. This will give you peace of mind that no one will come and take away your life's work.
There are some key things to remember: paying all your taxes, obtaining all licenses required, having all transactions in writing, and being in contact with a lawyer. If you do all these things, you'll have a business that's run legally without any issues.
