Mum on bed drinking coffee and looking a a laptop

Getting the Legal Side Right in your Home Business

It’s easy to think of small home businesses and large enterprises as completely separate entities, but we’re really not that different at all. Both businesses provide products or services to a customer or client, and whether you run your venture from a spare bedroom or a swanky corporate office, the customer will expect the same results. Whether you work on your own or hire fifty employees, the laws surrounding business are the same- sure, there will be many that don’t apply to you with your smaller company but it’s certainly not something you can overlook completely. Get it wrong and you could be fined just like any other business, go bankrupt and end up in trouble with the law- so make sure you consider the following things.


If your business causes harm to anyone as a result of your services, products or anything else then you could be taken to court and prosecuted. Maybe you’re a home baking business that has given incorrect allergen advice, or perhaps the baby clothes you made had something sewn on which caused a child to choke. Sometimes these things are genuine, one off mistakes but can have a huge impact on people’s lives. These people will want compensating for the damage caused. Unless you have business insurance to cover you then you can end up seriously out of pocket, probably bankrupt. Do your research and take out the right policies for your business, hopefully you never need to use them but it’s naive to assume that you’ll be fine without. If a case is made against you, at least you have the peace of mind that your insurance will cover the cost.


When you work for yourself in any capacity then you’re responsible for doing your own taxes. Get this wrong and you can end up in serious hot water. Declare your business once you start trading, and get into the habit of putting a chunk of your profits into a separate bank account, ready to pay up in April at the start of the new financial year. Taxes can now be done online and it’s been made relatively simple for the average person to understand, but it can be worth hiring an accountant if you’re unsure. As well as making sure all of the figures are correct, they can claim back any expenses that you’re entitled to. Using accounting software is a smart way to go, even if you’re a small business which isn’t bringing in much profit. Getting on board with the right tech is key, from tracking the day to day ins and outs, find out how technology can help you be FCA compliant and much more.

Data protection

When we think of criminals targeting businesses, it’s easy to picture burglars stealing cash from safes, computers, and fraudsters rinsing bank accounts. However, it’s not always cash and assets that these people are after. Data can be incredibly valuable as it allows thieves to steal identities, taking out large loans and credit cards and even commit crime as they pretend to be someone else. As a business you will be dealing with people’s data, not just sensitive things like bank details but names and addresses, emails, phone numbers. You absolutely need to keep these safe, if they’re stolen then you’re in trouble. It’s the law for you to inform your customers if this happens which can hugely destroy your reputation. Chances are loyal customers will boycott your business, and if others hear about it (which thanks to social media, they inevitably will) others can be put off too. The right software and the right procedures with dealing with data will help you to keep it safe and prevent criminals from stealing your customers information.

What sorts of legal issues tripped you up as a small business just starting out? For example, are you a blogger who has been accused of using copyright images, or have you ever had any legal implications as a result of what you do?

This post is written by a third party and I have received payment for publication.