Starting a business is exciting. The idea of watching your ideas become a reality is incredibly gratifying. However, before that can happen, you need to take the necessary steps to protect yourself and make sure you’re following all the rules. 

Before you start your business properly, legal work should be done. An example is getting the online tax ID number. Unfortunately, it’s easy to become so focused on launching your new business that you overlook essential legal documents needed before you can get started. 

Here’s a list of nine essential legal documents every entrepreneur needs before starting their business.

• Memorandum Of Understanding

A Memorandum of Understanding (MOU) is a document that outlines an agreement between two or more parties, which can be formalized in some ways. It can define the terms of cooperation between various individuals and organizations, or it may lay out the parameters for future cooperation between them. 

Companies often use MOUs for strategic partnerships, joint ventures, mergers, and acquisitions. In addition to outlining such agreements, MOUs often include confidentiality, exploratory work, rights and responsibilities, dispute resolution procedures, a plan of action, a timeline for completing tasks, reporting requirements, etc.

• Trademark Or Service Mark Registration

A trademark is a word, phrase, logo, or design that identifies the source of your goods or services to consumers. A service mark is similar to a trademark except that it refers to the source of services rather than goods.

This must be used with words such as ‘my business name offers this type of service’ or ‘this service provided by my business.’ Service marks can also include symbols such as an emblem or slogan. The difference between trademarks and service marks lies in their use: a trademark indicates who manufactures something, while the latter indicates who offered some quality involving labor or skill.

• Non-Disclosure Agreement

A Non-Disclosure Agreement (NDA) is a binding contract between two parties: one party may disclose confidential information to the other party. In return, both parties agree that they won’t disclose this information to anyone else. 

NDAs are typically used in business relationships where trade secrets or proprietary information are exchanged (such as between a technology company and its employees). This is one of the documents investors look for before investing in your business.

It would be best to have an NDA when working with clients with sensitive or proprietary business interests. If you don’t have one, your client may sue you for disclosing confidential information without permission.

• Business Plan

The business plan is one of the most important documents you will write in your career. It’s a map for how you want to run your company, and it helps you make decisions about hiring people, setting up sales goals, and deciding what projects are worth pursuing.

There are several different formats for writing a business plan, but they’re all made up of the same essential components: an executive summary overview, analysis of the market environment, and strategic recommendations. It should also contain financial projections, management team resumes and bios, and appendices with legal documents such as leases or contracts with vendors.

• Tax Registration Certificate

Your tax registration certificate is essentially an identification number that tells government agencies that they can trust and use information coming from your company without needing verification every time. 

The most common way for businesses to obtain these certificates is by registering with state or local governments; however, some countries don’t require businesses to register with any agency.

• Business Registration/Articles Of Incorporation

You will also need to register your business with the state. This is called business registration or articles of incorporation. You’ll likely want to get this sorted out before you start advertising and selling your goods or services, as it can take some time to complete.

If you’re operating in only one state, registering a business there is simple enough. Go to the website of the Secretary of State (or similar office), fill out the application form, pay any required fees and submit it along with some additional information like copies of all relevant documents. 

However, if you plan on operating across multiple states or countries, things get slightly more complicated. Each state has its own set of requirements, and in addition, each country may require additional steps depending on what type of entity they’re dealing with (whether LLCs are recognized under local laws, etc.). 

• Operating Agreement

An operating agreement is a contract between partners that sets out the rules, responsibilities, and expectations of each partner in a business. It would be best if you had an attorney review your operating agreement before signing it. 

It’s important to remember that an operating agreement only governs the relationship between partners during their time together as partners; they don’t govern how they’ll deal with creditors or other third parties outside of their relationship as partners.

• Partnership Agreement

As a business owner, you should consider drafting and reviewing a partnership agreement for your business.

A partnership agreement is a formal written contract that establishes the terms of your relationship with another person or entity. It can include details about how profits will be shared, how disputes will be handled, and what happens if one partner leaves the company or dies.

When starting a business, there are quite a few things to consider, from choosing an appropriate structure for your new venture to setting up accounting procedures and hiring staff members, and putting together a comprehensive legal document like this beforehand.

• Employment Agreements

An employment agreement is a contract between you and your employee that outlines the terms under which they will work. It includes all the rights, duties, and responsibilities of both parties involved in the relationship. Here are some of those terms in the contract:

• Compensations and bonuses
• How long they are expected to work
• When they get paid
• What their job title will be
• Causes for termination
• Formal procedures for termination
• Other job benefits

Employment agreements also establish strict confidentiality clauses that prevent employees from revealing proprietary information about your company after leaving.

Conclusion

As an entrepreneur, you should have a basic understanding of the different legal documents your business needs. It’ll make it easier for you to start your business and keep it running smoothly. Don’t worry too much about each specific document as long as you know what they are for. This’ll help you stay focused on your business and not the paperwork.