Legal Documents Your Small Business Needs
So you want to start a small business?
But, do you have all of the legal documents that you need to legally start and operate your small business?
Having the right legal documentation is a crucial part of the Startup Journey. You need the legal documentation to protect yourself from future legal problems and ensure that your business is in compliance with the law. However, determining and identifying the legal documents/legal documentation you need can often be a time-consuming and challenging task. The type of legal documents your small business needs will vary depending on your business needs, the nature of your business, the type of product or service you offer, your stage of business operations, and more.
Fortunately, we have created a handy list of the most important legal documents you need to start a small business.
We recognise that not all businesses are the same, so we have arranged this article to reflect these differences. Please note that this is not an exhaustive list of all of the legal documents that your small business needs and not every item may be applicable or relevant to your small business.
Limited Company And Limited Liability Partnership Specific Documents:
1. Certificate of Incorporation – the legal evidence that a person has incorporated their business. To incorporate a small business, you must register it with Companies House. It costs £12 and your company is usually registered within 24 hours.
2. Memorandum of Association – a legal statement signed by all initial shareholders agreeing to create a company and become members of the company. This is document is mandatory and must be drafted correctly because it cannot be amended once the company has been incorporated.
3. Articles of Association – company rules and policies about running the company agreed by the shareholders, directors and company secretary. Like a Memorandum of Association, it must be submitted prior to incorporation.
4. Partnership Agreement – an agreement between two or more partners that sets their responsibilities and level of liability for business debts.
5. Shareholder’s Agreement – an agreement between shareholders of a company that sets out their rights, responsibilities, ownership stake, ownership stake, and describes how the company is going to be run.
6. Director’s Service Agreement – an agreement between a company and its director that sets the rights and obligations of the director.
Essential Legal Documents For All Small Businesses:
1. Non-Disclosure Agreement (NDA) – is a legal contract between two or more parties that signifies a confidential relationship and prevents the parties from disclosing confidential information. An NDA is very useful when talking to potential investors, clients and suppliers – or really anyone because it helps protect your intellectual property and ensures any proprietary information disclosed during conversations or meetings are kept private and confidential. It also prevents the other party from stealing your small business idea and claiming it as their own.
2. Employment Agreement – a legal agreement between an employer and employee that outlines their rights and obligations. Unless you plan to run your small business entirely by yourself, you will need employees at some point.
3. Sales and Service Contract – a legal agreement between a business and customer that outlines the terms and conditions of the sale of a good or provision of service.
4. Terms and Conditions – a legal agreement that regulates the relationship between businesses and consumers, businesses and other businesses, suppliers, etc.
Small Business Legal Templates
With such a wide range of free legal document templates online, it can sometimes seem cost-effective to use an online legal document template or draft your own legal document.
However, if you are not familiar with the law or know how to draft legal documents, this can be more costly in the long run. Also with online legal document templates, there is no way to verify or establish who created the legal document or if the person is a trained legal professional and they are not as reliable as customised legal documents designed specifically for your business. Therefore, it is always better to just consult a legal professional.
At Linkilaw, we offer free Startup Legal Sessions. Simply visit our website to book a free Startup Legal Session and a Linkilaw legal specialist will help you find out how to protect your business from legal troubles and determine which legal documents your small business needs. You will also receive a detailed Startup Legal Plan within 48 hours of your Startup Legal Session and a StartUp Legal Solution.
Give us a call on (+44) 0203 151 0011 or submit your enquiry and our legal team will be happy to book a free one-to-one consultation with you.
The information provided on this page does not constitute legal advice.