New business regulations come into play all the time, and after a while, keeping up with the changes in legal requirements can start to feel like a job in itself. However, failing to adhere to these ever-evolving rules can quickly land you and your business in hot water. To help you stay on the right side of the law, we’ve pulled together five of the most important things to consider.
1. Filing your company’s confirmation statement
A confirmation statement is a document providing the government with your company’s details, including your office’s address, your principal business activities and the names of any shareholders. Known previously as an annual return, every registered UK company is legally required to submit a confirmation statement at least once a year to ensure the Companies House has your up-to-date company information.
You must file your statement no later than twelve months after your new company’s date of incorporation. For established companies, the review period is up to twelve months after your last confirmation filing. Even if you don’t have any updates on your company’s details, you will still have to confirm an annual statement. While there isn’t a fine for late submission of your form, it is a criminal offence not to submit one at all, and this could lead the registrar to believe your company is no longer operating and strike you off the register. This means that your company will no longer legally exist, and its assets will become Crown property.
This process is fairly simple and can be completed online. The likes of Online Filings require you to simply find your company in the Companies House register and choose a package that is right for you, then fill out a short simplified application form with your company number and authentication code. This process takes less than five minutes to complete, and can be approved within three hours. Submitting a confirmation statement online also saves you money, compared to submitting a paper form, which costs £40.
2. Employers liability insurance
It’s a simple fact that, if your business hires any staff, you will need to take out an employers liability insurance policy. If a worker makes a claim against you, this covers any compensation or legal fees. Whether your employees work on a full-time basis or on freelancing terms, this cover is a legal requirement for all businesses with at least one employee.
Staff can have multiple grounds to make a claim against their employers, such as if they injure themselves, or become seriously ill as a result of their work, or if a client or member of the public is injured or has their property damaged by your professional actions. Failing to have employer’s liability in place may result in your business facing hefty fines of £2,500 per employee working for you, which could leave you with some considerable financial ramifications.
3. Ensuring your software is licensed
Your business likely uses a huge variety of software programmes on a daily basis, whether for word processing, accounts, billing, and databases. Regardless of which ones you use, they must be licensed for use. If you use unlicensed software, it most likely won’t do everything you need it to for long, as software providers can check their registrations and only allow their use for a certain amount of time before suggesting a paid software upgrade. You’ll also receive no additional support and face security risks, with viruses and malware issues rife amongst unlicensed programs. Illegal use can also land you with both civil and criminal penalties.
When initially accessing any software, you will have already agreed to its licensing terms and conditions, and complying with these terms is vital. It’s against the law to use unlicensed software, which includes any unauthorised use or distribution from downloading, sharing, selling or installing multiple copies. Although it may cost more to have licensed software, it’s worth it in the long run, as it prevents you from facing any potential legal problems.
To avoid legal issues, keep track of which programmes you use, and make sure to keep any relevant documentation which contains details of the software license. Write down the name of the software, its associated ID, the license number for that particular installation, when it was installed, and verification of compliance. Having this documentation protects you should a software vendor accuse your company of noncompliance to their terms.
4. Intellectual property protection
Protecting your intellectual property (IP) can safeguard a range of your creative business ideas, including your business name and logo, any products you’ve designed and created, and trademarks. It doesn’t just cover your ideas and concepts, but also business assets like any equipment that is essential for running your business.
With more businesses relying on the internet to promote and sell their products and services, there is a heightened risk of individuals having their unique ideas infringed upon. This includes violating the terms of any agreement made with third parties—for example, if you were to use someone else’s design without the owner’s permission you would be subject to an infringement claim. It’s worth protecting your IP in case people try to steal your ideas and sell them off as their own. For instance, if you own a trademark and someone uses a similar one to sell similar products or services, this could count as a case of trademark infringement.
By having IP protection, your business will be covered if anyone tries to copy your creative property. It also stops you from unintentionally stealing or copying other creative work from others.