Are you an entrepreneur? An owner or a manager at an SME? Who do you think is the right lawyer for you?

Here’s something that most inexperienced, and sometimes even experienced people miss while hiring lawyers. Almost all big corporations apply this knowledge to reduce their penalties, legal bills and costs. Most importantly, this does not apply to just lawyers, this is a general principle that you can apply while hiring any professional – and of course applies in case of accountants and company secretaries. Don’t go for the plumber who offers temporary fixes to your pipeline which keeps leaking and bursting, find the plumber who will tell you what is really wrong with the pipeline in the first place and will help you in building a leakproof system. Its worth paying a bit extra to the plumber who fixes it once and for all, since he saves you headache and productive time.

Most lawyers out there want you to approach them again and again with new problems, so that they can make more money. Their business model depends on you having recurring problems. So they will always like to offer you temporary fixes, instead identifying the root of the problem and eliminating it altogether. That is why, their actions or advise will not change anything in your policy, or business process, but will merely deal with the problem at hand. Go and ask an average lawyer, “What can I do to ensure that I do not face any legal problems in my business?” The lawyer will tell you to come back when there is an actual problem.

What you need, on the other hand, is a pervasive policy that prevents legal liability from arising in the first place. Everytime you pay for a lawyer, at least ask him what you can do to prevent this problem from arising in future again.

Think for a second, how does a corporation deal with its taxes? Don’t forget that in case of a corporation with operations spanning accross the country, and having many many people collaborating to keep things in order, the task is much more difficult than whatever a startup company or SME might encounter. Still, it is worth learning from what the corporations would do.

Usually, they will set up several processes within the company, with specific roles for every individual involved in the accounting and tax payment. If everyone follows the duties assigned to them, accounting is managed and tax is paid like clockwork. Otherwise, problems and issues will arise causing the top management to spend time and money on unproductive and unpleasant business with tax officials and tax lawyers. Clearly, this is achieved through prior planning, creation of necessary processes and communications so that everyone in the organisation is clear about their duties and deadlines right from the beginning, and a certain amount of monitioring of the processes. This does not only prevent legal problems from arising, but also leads to better and advanced tax planning – in other words, tax savings.

While for a corporation really complex planning and professionals with great expertise may be needed, for a startup or SME the same can be achieved much more easily with some simple policies. Especially, there must be a prior plan in place for handling various types of compliances.

In India, top concerns are usually taxation, local municipality laws, labour law compliances, export-import regulations, general corporate compliances apart from sector specific issues. Get lawyers and accountants with understanding of these areas to make a prior plan for you. Everyone can not do everything – get the accountant to suggest policies for handling direct taxes – in other words, income tax. For everything else, get competent lawyers to make you a list of compliance requirements. Then sit down and think over what processes can be created in your organisation to meet all those compliance requirements easily and without significant trouble and cost. Sometimes you can find lawyers who can do both the things for you, and is willing to do so (after all, by doing that he is losing out on possibilities of handling your regular problems in future). When you do find such a person, know that he is the elusive right lawyer for you.

And if at all you don’t find any, feel free to Contact Us.