{"id":986,"date":"2026-03-19T14:51:46","date_gmt":"2026-03-19T14:51:46","guid":{"rendered":"https:\/\/www.simplybusiness.co.uk\/knowledge\/articles\/legal-obligations-of-a-business\/"},"modified":"2026-03-19T14:53:35","modified_gmt":"2026-03-19T14:53:35","slug":"legal-obligations-of-a-business","status":"publish","type":"knowledge","link":"https:\/\/www.simplybusiness.co.uk\/knowledge\/business-structure\/legal-obligations-of-a-business\/","title":{"rendered":"Don’t forget these 4 legal obligations for your small business"},"content":{"rendered":"\n

Keeping track of the legal obligations of a business can feel like a job in itself. It’s rarely a case of learning the rules when you start out and leaving it at that.<\/p>\n\n\n\n

The legal requirements for businesses are ever-changing, with new rules and updates coming into place each year \u2013 <\/strong>and small business owners are expected to keep up.<\/p>\n\n\n\n

Staying on top of regulation helps you avoid administrative headaches and keeps you on the right side of the law.<\/p>\n\n\n\n

To help you protect your business, we’ve pulled together four of the less obvious obligations to watch out for.<\/p>\n\n\n\n

4 legal obligations for your business you may have missed<\/h2>\n\n\n\n

1. The missing licence you didn’t know about<\/h3>\n\n\n\n

It’s common knowledge that running a business that serves food or alcohol requires you to be licensed, or gas engineers needing to be on the Gas Safe Register.<\/p>\n\n\n\n

But there’s another type of licence that can often be overlooked.<\/p>\n\n\n\n

If someone asked you which software packages your business uses, would you know the answer? And would you know if they’re licensed versions?<\/p>\n\n\n\n

If not, it’s a good idea to find out. Failing to use licensed versions of the software your business relies on means you’re breaking copyright law. It can also mean that you’re opening your business up to cyber attacks<\/a>.<\/p>\n\n\n\n

While it might cost more to begin with, being a licensed software user pays off in the long run. Keep an eye out for downloads or software in your office that look less than legitimate.<\/p>\n\n\n\n

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Small business example:<\/strong> Using a pirated version of Adobe Photoshop or Microsoft Office could lead to hefty fines. Unlicensed software can also open your business up to cyber attacks.<\/p>\n<\/div>\n\n\n\n

2. The insurance you may not know you\u2019re legally required to have<\/h3>\n\n\n\n

Business insurance comes in a range of different types, from public liability insurance to professional indemnity insurance.<\/p>\n\n\n\n

The combination of covers you need will depend on the type of business you run. Some professional bodies might require members to have certain types of business insurance.<\/p>\n\n\n\n

For example, members of the Institute of Chartered Accountants in England and Wales have to have professional indemnity insurance.<\/p>\n\n\n\n

While it’s not a legal requirement for businesses to take out all the different types of insurance \u2013 there\u2019s one exception to look out for: employers’ liability insurance.<\/p>\n\n\n\n

Contrary to popular belief, it isn’t only for businesses with employees in the strictest sense of the word. Generally speaking, most businesses that have people working for them are legally obliged to have employers\u2019 liability insurance. This applies whether they are full-time staff, or hired on a more casual basis.<\/p>\n\n\n\n

As well as being required by law, it can potentially guard your business from unmanageable compensation claims. For example, if someone is injured or becomes seriously ill as a result of working for you.<\/p>\n\n\n\n

If you don\u2019t have employers\u2019 liability cover when you’re legally supposed to, you could be fined \u00a32,500 every day you are not properly insured. You must also display your certificate<\/a> where employees can access it, or you could face a \u00a31,000 fine.<\/p>\n\n\n\n

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Insurance to consider<\/h4>\n\n\n\n