You are ready. You have the idea thought out and the funds to make it happen. You are limiting the inner dialogue that tells you, “It isn’t possible,” and you are ready to give up most of your free time to make it work.
Congratulations! You are clearly about to start a small business.
One of the aspects of small business ownership that often gets overlooked is the legal side of things. That’s because many people don’t realize that almost every part of your operation can cause possible legal issues.
To ensure you are covered, read on to learn about the four times your small business is going to need a corporate lawyer.
1. When you are formulating your business structure
There are five main types of business structures: Sole Proprietorship, Partnership, Corporation, S-Corporation, and Limited Liability Company (LLC). The kind you select for your business is going to determine what liabilities you encounter, how you are taxed, and the manner in which your earnings get split.
For this reason, it is crucial that you choose the most appropriate one for you and your company.
Working with a corporate lawyer will provide you with the knowledge and know-how necessary to make the right choice. They will also guide you in ensuring that your company isn’t putting everything you own at risk and that you are in an excellent place to take advantage of tax benefits for small businesses.
2. When you are setting up your business
Depending on how complex your business is and how much prior experience you have, when it comes to setting up your business, there may be some situations wherein you can do on your own. For example, filing the necessary paperwork for an LLC is a simple task that you can probably handle.
Generally, it is recommended to use a corporate lawyer when you are setting up your business as they can help you with essential tasks such as completing the numerous forms and legal documents (such as incorporation documents), trademarking your name, and examining lease documents.
Additionally, by working with a professional corporate lawyer, you will have more time to focus on other aspects of your business while also having the assurance that the setup is getting done entirely and accurately.
3. When you encounter a conflict
No one wants to think that they are going to encounter conflict in their small business, but the fact of the matter is that it happens — often. In most scenarios, when a dispute arises, it is crucial to contact a corporate lawyer right away.
Whether it is a disagreement between your firm and a customer, between shareholders inside your company, or with a current or former employee, it is essential that you have high-quality representation to ensure that a settlement can be made fairly and justly.
If there is a breach of contract or an unexpected situation or accident, working with a corporate law firm in Dubai (or wherever you reside) will ensure that your personal and business interests are of high priority and they will protect you and your entity. They may opt to settle the dispute through mediation, arbitration or litigation — none of which you could do on your own.
4. When you are considering selling your company or acquiring another company or its assets
If your small business has been growing, you may eventually come to a point wherein you are looking to offer ownership shares to the public or to sell the business entirely. In this scenario, a corporate lawyer will assist in facilitating the full or partial sale of your company by dealing with the financial aspects as well as the adjustments to the business formation.
Alternatively, if you are looking to perform a “special allocation” of profits and losses or are considering contributing property to your LLC agreement, then having a reputable law firm by your side will be necessary.
Have you used a corporate lawyer for your small business? If so, how was the experience? If not, what is holding you back? Please share with us your insights in the comments below!