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A startup will require not only a company concept and its technological execution, but also an expert legal design of the project for interaction with clients, investors, and subcontractors.

Legal assistance is required throughout the entire project life, but assistance during the stage of starting a business will help to avoid many issues that might develop when the activity is not structured properly.

Is registering a legal entity required?

Lack of a corporate entity is among the first errors that a startup makes. This includes assigning each project risk to a specific person. You must establish a legal corporation or register as an individual entrepreneur to differentiate between your personal and business obligations.

Entrepreneurs must be informed of and current with the most recent regulations affecting their business and market, from formalising a founders' agreement to protecting intellectual property to upholding business contracts.

Before starting a business endeavour or making plans to turn the startup idea into reality, startups and entrepreneurs in India should be aware of several fundamental legal principles:

1. The first and most important stage for any successful firm is to consider beginning business ideas. In a word, a person needs to be certain about the kind of starting firm they intend to expand. As they work on their startup ideas, the founders must incorporate the company as a certain business kind, such as a sole proprietorship, private limited company, public limited company, partnership, limited liability company, etc. In order to achieve the entire vision and goals of the company, both short- and long-term, it is essential to have this clarity from the very beginning. Additionally, it aids the founder in foreseeing the course they should go to secure startup funding.

2. Running a business requires obtaining licences or registering as a startup. Several licences are applicable in India depending on the type and size of business. The ideal strategy to launch a business is always to be aware of the necessary licences and to acquire them. Legal disputes and expensive lawsuits may result from a startup business's absence of the necessary permits. While startup registration is the formal process of officially listing a firm (together with necessary information) with the official registrar, licences are the legal documents that provide a business permission to function.

3. Every beginning business has taxes as a necessary component. Before starting a firm, an entrepreneur needs to be familiar with all tax regulations. There are several different taxes that may be applicable for some new businesses, including federal taxes, state taxes, and even local taxes. Knowing this in advance can be helpful because different business and operating sectors attract varying taxes.

4. Every new firm, no matter how big or small, must follow labour rules. Regardless of the size of the organisation, once you have employees and are established as a business, you are subject to many labour rules.

Compliance with laws governing minimum salaries, gratuities, PF payments, weekly holidays, maternity benefits, sexual harassment, and bonus payments, among others, is required. It is advisable to seek legal advice to determine which regulations apply to your starting business and to make sure that it complies with all applicable labour laws.

5. The secret ingredient for the majority of startup companies today, particularly tech-focused companies, is intellectual property. Some of the most typical intellectual property that organisations own include codes, algorithms, and research discoveries. Startup businesses may benefit from the Startup India initiative's "Scheme for Startups Intellectual Property Protection" (SIPP).

6. The core of managing any beginning business is contracts. A contract is necessary to ensure the successful completion of the task and is an excellent mechanism to secure redress in the event that the work is not completed. For business owners, having a basic understanding of the different facets of contract administration can be useful.

7. Any entrepreneur knows how difficult it is to decide to close a business or shut it down because of a poor business concept. All parties involved in a startup company's decision to close up shop must be informed beforehand, and the entire process must be carefully planned and carried out to make everyone's exit as painless as possible.