If you’re starting a small business, you’ll need to know about small business law. Don’t be put off setting up because you don’t know what laws affect running a small business.
A Quick Guide To Small Business Law
Here are the main small business laws you need to bear in mind:
Business Licences
Unlike some other countries you don’t need a business licence just to start up a business in the UK. However, licenses are needed for a fairly small number of business activities (things like selling alcohol or money lending).
Here’s a useful WBO article giving more information about business licences
Planning Permission
It’s always a good idea to check with the local council if you need planning permission for change of use before buying or renting any business premises. In most cases, if the property is already an office or shop and you want to use it for the same thing, you won’t… but always make sure.
If you’re running a business from home you won’t normally need planning permission just to use your home for office work or light storage. Anything more than that may well need planning permission though, so again, do double check.
Forming A Company
You don’t have to start a formal company to run your business through if you don’t want to. If you’re planning just a fairly small/part time/home venture then you can set up and start trading using what is known as a sole trader business format.
Here’s some more information from WBO about the different types of business format you might want to consider
Choosing A Name
You can choose more or less any name you want for your business, but it shouldn’t be a name that is already being used by an existing business (or too similar to a name already being used) as that could get you tied up in passing off disputes. You aren’t allowed to use a few names without permission (such as Royal, British or School) but you only need to get official approval for your name if you’re forming a limited company. Companies House at www.companieshouse.gov.uk has more information on this.
Employing Staff
If you’re employing staff the law affects you in many more ways than if you’re just an owner-operator. Amongst other things you’ll need to:
- Give your staff a contract of employment.
- Ensure they’re paid at least the minimum wage.
- Ensure they have the correct holiday, maternity leave and sickness pay entitlement. Ensure you don’t discriminate.
- Take out employer’s liability insurance to protect them.
Health And Safety
Health and safety affects every business in some way. You’ll need to make sure that your business premises, products, procedures and equipment comply with health and safety laws – to keep you, your employees and your customers safe. It’s a good idea to do a risk assessment before you start up, so you can identify any possible health and safety problems
The Health and Safety Executive has a useful website giving more information about health and safety at work – including details of how to carry out a risk assessment: www.hse.gov.uk
These are just a few basic tips to point you in the right direction. If you’re unsure about how the law affects your business always take advice from a lawyer or business advisor.