You have an idea and a plan to make it profitable. But there are countless legal issues involved in starting a business and the choices you make can be the difference between success and failure.
You probably know that it's essential to get a patent for any invention that will be exclusive to your business. You may also need a trademark, copyright or industrial design to protect any original words, symbols, photographs, etc. Make sure you legally protect all of your ideas from being copied by others.
The next step is to decide on, and develop, the type of business that's best for your idea. The simplest kind of business to set up is a proprietorship. This is where you are the only person involved. You run the business and you keep all profits and assume all losses. It's an inexpensive way to begin, but it can be difficult to raise start-up capital if you do need it.
A partnership may work better for your project. It's a good way for two or more people to combine abilities and knowledge to run a business. A partnership agreement needs to be established, but it's still fairly easy to set up, and there can be additional sources of money to rely on.
Incorporating is the most expensive and most difficult type of business to start. The advantages, once it's set up, are the ease of getting capital and the possibility of being involved while maintaining limited liability.
What happens to your business if you pass away? A buy-sell agreement enables the business you start to keep going. It can ensure that your family will not be burdened with outrageous taxes and that the money they were counting on from the business will be there for them to use in the future.
You'll need an attorney to help you set up a buy-sell agreement. In fact, it's strongly suggested that you talk to a lawyer before making any of these major decisions about starting your new business.
At Kawartha Credit Union, we know how hard it is to start a new business, especially if it's your first. But don't worry, there are people and organizations out there who can help.
It's strongly advised that you consult a lawyer or legal accountant before making any major decisions about starting your new venture. They can help make sure that you meet all the necessary legal requirements before you begin. Be selective in choosing a lawyer. Make sure that he or she is knowledgeable about the type of business that you wish to begin, and able to provide all the services you'll need.