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Legal Issues That You Can Prevent With Your Business

If you run or own a business, you will often encounter and be subjected to many laws that determine how your business can operate. Non-compliance with these laws can cost you greatly, and it’s important to understand how to maintain your business without breaching these laws.

Though there are multiple legal issues that any business owner (big or small) can face, here is a list of some of the most common legal issues that you might encounter and should watch out for.

Incorrect Tax Deductions

Filing your taxes can be a complicated process for businesses. If you try to handle it without the assistance of a professional, it can become even more difficult. This might be because of the way your business is structured, the complexity of getting the deductions correct or getting your tax obligations wrong.

In this instance, minimising the risk can be as simple as researching the tax obligations that you will have prior to registering the business. If you can afford it or can budget it in, hiring a professional to assist in your tax return can be a lifesaver.

Unsatisfied Customers

As a business owner, it’s important to remember that you won’t always be able to satisfy every customer. However, some customers may be so severely dissatisfied with your business or products that they may leave a false review, or in the worst-case scenario, take the legal route and sue you.

In the case of bad reviews, if they are falsified you may be able to take legal action to get the reviews taken down. However, in the worst-case scenario, you may need to receive legal assistance from a professional such as a litigation lawyer.

Licensing

For most industries, there is a licence you are required to get before you can legally trade. Building licenses, liquor licenses and real estate are some of the most common licences business owners have to obtain.

This is to ensure you have been properly taught the laws relevant to the industry and that you know how to operate the necessary equipment.

If you are not sure if you require a licence, it is essential that you check. Having the license is also a great selling point and you can face heavy fines if you are caught trading without the right one.

Employment & Employees

It can be tempting to hire your employees on an informal basis, but this can lead to issues down the track.

Even if your employees are covered by a Modern Award, you should formalise your hires. You can do this by using an employment contract, which will clarify the terms of employment, conduct and grounds for termination.

Further, having the right workplace policies will allow you to set out your office procedures clearly. Legal issues for small businesses can arise in relation to an employee’s use of social media, conduct or even if your employees smoke at work – this is why it’s always wise to have documents that cover these.

Intellectual Property

People and businesses are coming up with new ideas and technologies all the time. Two people from opposite ends of the country might both have the same innovative idea at different times. Neither has ever talked to the other person and could not possibly know if the idea has been done already. It’s why the issue of intellectual property is now one of the most common legal issues.

Before commencing operations, it’s important to properly check that ideas such as your business name, logo and slogan aren’t already out there. You can search online to see what trademarks have been registered. If there happens to be one similar or the same to what you had in mind, you risk getting into legal trouble for trademark infringement. The lesson here is to register your business’s trademarks early on because they will only become more valuable to your business as it grows.

These legal issues are only a few of the most common but by identifying them as risks of breaching the law that your business can manage, you can form plans to prevent them from occurring.

If you’re someone who often finds it difficult to make large lump sum payments for goods or services, you may want to consider looking into “Buy Now Pay Later” services.

Buy now pay later essentially means that, rather than paying in a full lump sum payment for a product or services rendered, there may be an option to pay through instalments of a certain amount over a set period to make the sum of the full amount in total. This method should allow you to pay in full for the product or service without overly straining your finances – you pay back what you can, as agreed upon when you begin the buy now pay later service.

Some popular buy now pay later services include Afterpay, Zip Pay, Brightepay, and some credit card networks such as  Mastercard and Visa, can offer buy now pay later arrangements.

Though it can be a convenient, immediate solution, it may be challenging to juggle the necessary repayments with other financial commitments. It’s not always the most appropriate method for people, and you should bear in mind your situation and ability in paying back the amounts. 

Before you sign up, keep in mind: 

  • It becomes easier to overspend with buy now pay later services, so know your limits on what you can and can’t afford.
  • You will be charged fees and costs to use the service, which can add up to a princely sum in and of itself.
  • Keeping track of your payments can be tricky if you’ve signed up for multiple services.
  • It could affect your loan applications for a car or mortgage as lenders consider buy now pay later spending just as much as your credit score.
  • Late repayments can appear on your credit report, which affects your ability to borrow money in the future.
  • Layby can be a cheaper alternative to buy now pay later, with no account-keeping or late fees to consider

If you are someone who could make use of BNPL services, you may wish to:

  • Ensure that when using the BNPL service, you stick to a set limit on what you spend so that you can comfortably pay it back later. 
  • Aim only to have one BNPL account at a time to manage payments through, rather than confuse yourself with multiple payments across different providers.
  • Always budget for bills, loan payments and BNPL payments, and 
  • Rather than use your credit card for payments to your BNPL account, consider linking to your debit account instead.

If you would like assistance in planning your financial future, help in managing your budget or some friendly advice, see us for a chat about what we can do for you.

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John Briggs

Jane Noller has been my accountant for the last 15 plus years. I can testify to Jane’s professionalism and expeditious manner in dealing with the day to day issues that surrounds our business accounting.

John Briggs

Registered Building Certifier

David and Alison Parker

I have been consulting J L Noller and Co. (more specifically Jane) for six years and during this time I have found her to be professional, efficient and easy to discuss all accounting and taxation matters with. Her office team are all polite and friendly also.

David and Alison Parker

Business Owner

Carl Gillmore

I have used Jane & the team for the last 6 years for all of my business & personal accounting needs. They have always been professional, easy to talk to & available when we have needed assistance.

Carl Gillmore

Carl Gillmore Landscape

John Briggs

Jane Noller has been my accountant for the last 15 plus years. I can testify to Jane’s professionalism and expeditious manner in dealing with the day to day issues that surrounds our business accounting.

John Briggs

Registered Building Certifier