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What You Need To Know About Starting A Formal Business
You have been wondering how to start a business but don’t have the idea? Many of us are interested in starting a formal and registered business but don’t know the formalities involved.
So in this post, we will guide you on the necessary steps to set up your business.
Choosing your company name is one of the most important steps in starting a business. You want to make sure that you not only choose a name that is appropriate for your business, but also that it fulfills certain legal requirements.
Your company name should be more than just creative and representative of your business; it should also be legally available. Your company name, once registered, becomes your trademark.
Your trademark is what sets you apart from competitors and protects your brand image in the marketplace.
Creation of a legal entity
The entity is the person or thing that you can sue in a court of law. It is helpful to think about a legal entity as being synonymous with a registered business because in this context it means the same thing.
If your business gets sued by someone else, it will be the legal entity that is doing the suing or getting sued. Depending on the structure of your business, creating a legal entity could mean incorporating your company or forming an LLC.
There are various reasons why you would want to create a legal entity for your business:
- It’s required if you plan on hiring employees
- You want to raise money from investors and venture capitalists by selling stock in your company
- You want to limit personal liability if someone sues your company (to just losing whatever money you invested into it)
Setting up a company bank account
Keeping your personal finances separate from your business finances is an important step in protecting yourself and your assets. It will also be helpful in the future if you need to obtain a business loan or line of credit.
There are several banks that offer business banking products, including Bank of America, Chase, Wells Fargo, and Citibank. When opening a company bank account, you will be asked to provide certain information in addition to the name and address of your company:
Another important aspect of business ownership is taxation. This is a very important subject for you to understand and get right.
The government will take a percentage of your income as taxes. This can be used by the government many different ways, such as helping people or paying for schools and hospitals.
Intellectual property rights protection
You can protect your company’s intellectual property in two ways: by copyrighting the idea and then patenting it or by registering a trademark with the government. Both are important, but each has its own little quirks that you must be careful about.
The copyright protects the expression of your work, so long as you haven’t copied someone else’s work to do so. The expression may not actually be copied (or it can be) depends on the type of work.
For graphic design, things like drawings and paintings are excluded from protection; they are considered artworks and not subject to copyright law. A photo booth is an example of a “type of intellectual property,” which is protected under copyright law.
People might think that this means you can use any old photo booth as long as you change one thing—not quite! The copy right covers ONLY what is expressed in the image (including photos), so if you alter that image in any way, all bets are off for infringement.
To keep your photo booth from being stolen or pilfered for use elsewhere, agree on a licensing contract with the owner who owns the rights to the original photo booth design and images, giving his permission to use those materials for commercial purposes such as a business rent-a-babysitter service or a wedding venue that rents out photo booths.
Registering your business can be good for you, your business and the economy at large.
We all have to start somewhere. While starting a business might be the most challenging thing you’ll ever do, it can also be one of the most rewarding—especially if you take advantage of all the things that are already in place to help you make your business succeed. Here are seven ways to register your business:
- Register your company as soon as possible. While registering a business is free, many people forget about doing so until after they’ve actually started their operation. Registering early will allow you to choose which tax registration method best fits your operation, whether it’s through the Canada Revenue Agency (CRA) or either provincial or territorial authority responsible for collecting and handling taxes.
- Choose a name that’s easy to remember and will be easy for customers to spell and say correctly when they order from you. Your name should reflect what your business does or sells; however, keep in mind that no names may be taken without a legal reason, including trademark issues. You must use this name at least once in writing whenever applying for corporate status with the CRA, whether online or in person at an office near you; otherwise, you’ll risk not being approved for corporation status altogether when it comes down to filling out forms later on (this process is called filing articles.)
- Keep basic business documents up-to-date so customers know what they’re getting when they order from you and any changes made between then and now don’t cause confusion later on down the line (change dates on receipts when selling someone something new). You should keep these documents up-to-date regularly: the minutes of meetings where key decisions are made; ownership information; financial records such as balance sheets; policies and procedures manual that sets out your rules and guidelines; receipts provided by suppliers that ensure everyone has what they need when coming into contact with each other; insurance certificates (if applicable); sales invoices/receipts/invoice documents showing order details along with payment history