Easy Offices has partnered with Contact Law, a Thomson Reuters Company, to provide some Blog Articles relating to the legal aspects of starting and running your own business. The first of several articles is below and to start the series off we are going to look at the legal aspects of Business Structure and buying or renting Commercial Property.
You need to decide whether to do business for yourself as a sole trader or partnership; or to create aseparate legal entity for the business via a company or limited liability partnership. Setting up a company or LLP protects you from personal responsibility for the debts and other liabilities of the business.
You also have more flexibility when it comes to arranging your tax affairs. On the other hand, the administrative burden involved is much greater than for a sole trader or partnership.(“LLP”).
Where a business is structured as a separate legal entity, this is normally in the form of a company. The LLP structure has some differences relating to taxation that often suit professional services businesses.
You can rent commercial premises via a lease or a license. A lease normally lasts for several years and gives you exclusive possession, meaning that the landlord can only enter the property under certain circumstances, such as to make repairs. A license is normally shorter and easier to terminate than a lease. It allows the landlord to come and go to the property as they please.
You need to review the rental agreement very carefully. In particular, check who is responsible for repairs and maintenance; the duration of the rental period and when it can be terminated early; and how rent increases are determined.
Dominic received a Law degree from the University College London in 2005. Dominic has previously worked as a legal adviser in the UK and South Africa and currently works for Contact Law, a company which helps match clients with solicitors. If you are looking to start you own business, you may need to seek advice from a Corporate Lawyer for legal clarification on business issues. Visit Contact Law to find out more.