There are so many things that could go wrong and what business owners need to know is that compliance is one of the best ways to manage most risks that are inherent to Startups. Non-compliance to regulatory requirements results in fines, restrictions on operations, and license revocations. Therefore, Startups must observe compliance guidelines to ensure smooth operations. Compliance can be a complicated affair, especially when you realize just how much needs to be done.
Here are some aspects of compliance that are relevant to every Startup.
Choosing the Right Business Structure
Deciding whether your business will be a sole trader, partnership, limited company, or any other type is extremely important. There are regulations and tax requirements that are unique to each business structure. Understanding how your business structure relates to compliance is the first step for every entrepreneur.
You might have enough capital to register as a sole trader or require funding hence opt for a limited liability company. Business capital is governed by a unique set of laws that you have to consider. Whichever the case, keep tax and other regulatory obligations in mind as you make this choice.
Most SMEs either comply with basic registration or overlook it completely. This is a grave mistake that could have serious legal implications. Take the time to understand the categories your business falls under and what is expected from you as far as registration goes.
Adhering To Audit and Tax Regulations
All businesses are required to carry out yearly audits and prepare annual audit reports. These reports must contain all financial transactions of the year. Startups and SMEs are not exempted from this regulatory requirement.
Auditing may not be a familiar concept for most people running startups simply because not everyone knows the ins and outs of recording transactions. To simplify auditing and ensure you comply with regulatory requirements, maintain a book of accounts. Hire an auditor to crunch the numbers and prepare a report.
Startups are required to declare their tax liabilities at the time of incorporation. Failure to do so creates inconveniences down the road.
If you need any assistance or require further information please contact us on 0870 228 1999 or email us on email@example.com