Starting your own business as a lawyer or legal professional can feel like a leap into the unknown, especially during times of low business confidence and challenging economic conditions. However, these times can also be a catalyst for pursuing new opportunities and achieving personal growth.
For many legal professionals, redundancy or diminished prospects in the traditional job market have sparked the decision to “fly solo” and establish their own practices – be it as a freelancer, sole trader, consultancy, partnership or firm. This move offers not only the chance to take control of your professional life but also the possibility of greater flexibility and long-term financial benefits.
Embracing the silver lining
While the economic climate may seem daunting, it’s important to focus on the potential silver linings of starting your own legal practice. Here are some of the benefits you can expect:
- Control over finances: By running your own practice, you have the ability to set your rates and choose your clients. This control can lead to increased earnings and a more stable financial future.
- Flexibility: Being your own boss allows you the opportunity to create a work-life balance that suits your lifestyle. You can set your hours, choose where you work, and tailor your services to match your strengths and interests.
- Personal growth: Starting your own practice pushes you out of your comfort zone and encourages continuous learning and development. You’ll gain valuable skills in business management, marketing, and client relations, enhancing your professional capabilities.
- Building a personal brand: As an independent legal professional, you have the opportunity to establish your personal brand. You can build a reputation based on your values, expertise, and unique approach, setting yourself apart in the competitive legal landscape.
Checklist for success
To ensure your new venture is compliant with legal and accounting requirements, it’s advisable to follow a structured approach. Here is a checklist of steps to help you get started:
Legal considerations
- Register your business and licenses: Choose an appropriate business structure and register your practice with the necessary authorities. Submit your application to practice on your own account with the law society.
- Find office space: Secure suitable office or chamber space to conduct your legal practice and meet with clients.
- Arrange insurance: Obtain professional indemnity insurance and any other necessary coverage to protect your practice.
- Set up legal resources & draft legal documents: Acquire library resources; develop precedents for contracts, agreements, pleadings, and other legal documents to streamline future work and maintain consistency.
- Client care: draft an engagement letter outlining the terms and conditions of the legal services to be provided.
More about choosing the right business structure
Financial and tax considerations
- Tax adviser: Contact an accountant or tax adviser to ensure compliance with tax obligations and assist with registrations including for GST and PAYE if required.
- Set up financial systems: Open a business bank account and arrange for a dedicated credit card or debit card. Implement accounting software, such as Xero, and time-recording software to manage finances efficiently.
- Budgeting and planning: Create a budget, business plan, and financial forecast to guide your business decisions.
More about accounting best practices for start-ups
More about cloud business accounting systems
Marketing and client relations
- Build your brand: Develop a marketing plan and design branding materials such as logos, business cards, and stationery.
- Launch a professional website: Secure a domain name and consider hiring a professional to design and build your website for optimal functionality and appeal.
- Set up communication channels: Establish a business phone number, email address, and PO Box for professional correspondence. Set up cloud software for document sharing and secure communication with clients.
- Network and promote: Attend networking events, talk to potential clients, and use social media to build relationships and promote your services.
Final thoughts
Starting your own legal practice is a significant undertaking, but with careful planning and determination, it can be a rewarding and fulfilling endeavour. By following the necessary steps to ensure compliance and success, you’ll be well on your way to building a thriving legal business.
Our specialised team at The Accounting Hub is here to support you when setting up your legal practice. Get in touch to see how we can help your practice flourish.
