The Legal Status of Small Business
Sole Trader is when one person controls the business but may also employ workers such as convenient stores or individuals that provide special service such as Photography and Hairdressers are counted as Sole traders. Sole traders do not have a separate legal existence from their owner. As a result, the owners are personally liable for the firm's debts, and may have to pay them out of their own pocket.
Partnership - A legal form of business operation between two or more individuals who share management and profits. The federal government recognize several types of partnerships. The two most common are general and limited partnerships.
Legal Aspects of Small Business
Laws - Commercial law, also known as business law, is the body of law that applies to the rights, relations, and conduct of persons and businesses engaged in commerce, merchandising, trade, and sales. It is often considered to be a branch of civil law and deals with issues of both private law and public law.
Health & Safety - Health and safety law is a body of law that protects the safety of the general public and certain populations such as employee's. Health and Safety at Work etc Act 1974. Often referred to as HASAW or HSW, this Actof Parliament is the main piece of UK health and safety legislation. It places a duty on all employers "to ensure, so far as is reasonably practicable, the health, safety and welfare at work" of all their employees.
How much tax you need to pay? for standard capital tax you will need to pay 10% to 18% amount of tax and if you have higher capital gains then you will need to pay 20% to 28% to pay for tax according to the government.
Financial Systems Suitable from Small Business
Record Keeping - The law does not say how you must keep your records. You need to keep some original documents which show that tax has been deducted.. it is recommended that you keep all original documents you receive. Most records can be kept electronically (on a computer or any storage device such as disk, CD, memory stick) as long as it is documented.
Credit control
Credit Control is a strategy employed by manufacturers and retailers to promote good credit. This will both increase sales and decrease bad debts, also improving a company's cash flow. Credit control is an important component in the overall profitability of many firms.
Unwarranted Debt may be a serious strain on the company and could lead to company failure. Many SMEs have failed due to unsatisfactory Debt Collection processes or procedures. During the credit crunch many businesses experienced a serious credit risk and severely curtailed extension of credit to partner firms and businesses. Even though the current situation is much less severe credit extension remains a key, pivotal role in business management.
who collect debts as part of their business.
How to make sure you will pay your debt in time:
2. Make it easy to be paid
3. Credit check new customers
4. Encourage prompt payment
5. Have a clear procedure for credit control
6. Don’t be afraid to take action
7. Treat credit control as an important job every week
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