Setting up an Entity
You must ensure you comply with the CILEx Code of Conduct
wherever it applies to you. Your professional and personal conduct will be judged against it.
Make sure you get all the right structures in place on day one that will grow with your business.
Good processes and procedures will mean you can concentrate on delivering a high standard of service to your clients.
Your Business Idea/Plan
Make your business plan as concise and readable as you can - two sides of A4 is fine. We have a Business Planning document within Resources
to help you.
Think about what you are offering, what is your market, who are your customers and what do they want.
Area of competence/Reserved Activities
Be clear on the work you can and cannot do and make sure that you are qualified and authorised to do all the work you are going to offer.
If you want to provide reserved activities then make sure you gain the necessary Practice Right and apply to become an Authorised Entity.
There are various alternative structures you can use to provide legal services through (sole trader, partnership, limited company, limited liability partnership, Community Interest Company, etc.). Check the business name you use is permitted and suitable for your organisation.
The systems you use and records you maintain should be appropriate to the size and risk of your business.
Make sure you have a viable financial model and regularly review it with management accounts.
With client money, remember it is not your money and you must have separate ledgers for each client. You must reconcile your client accounts at least monthly and maintain a separate signed record of the reconciliation.
We suggest you seek advice from an accountant as you may have financial needs for both yourself and the business, such as registering for Tax and VAT requirements.
Client Care and Complaint Handling Procedures
We are happy to review your new client care information and complaint handling procedures, so you get the fundamentals in place. We look for clear notification of status and regulation, details of the matter and what you will do for the client, what it will cost the client and what they can do if unhappy with the service provided.
Professional Indemnity Insurance
We strongly recommend that all members running their own firm have an appropriate PII policy in place. This protects you in the event of a claim against you and gives the client comfort that if anything goes wrong you are in a position to correct it.
Remember to consider your potential requirements for Public Liability Insurance, Employers' Liability Insurance and general business insurance.
Make sure your website accurately reflects what you are doing, the experience you have and the size and structure of your firm.
Add a link to our website so that clients can understand our regulatory regime and, for Authorised Entities, see your status on any directories.
Remember all your regulatory and statutory requirements to disclose information, for example Companies House, Data Protection, PII, Distance Selling, FCA and CILEx Regulation.
Where Else Can I Get Support?
We would suggest joining your local CILEx branch as well as the CILEx Sole Practitioners' Group on LinkedIn. Members are keen to find out who are running their own businesses locally or providing similar services so they can exchange ideas.
In England, the government funded website GOV.UK
is a good place to start. It provides information, contacts and advice for businesses, both start-ups and those more established, alongside a helpline for more specific queries. It will also cover business tax.
In Wales, the website is Business Wales
which is provided by the Welsh government.
The Companies House
website will give you guidance on your obligations if your entity is set up as a limited company or limited liability partnership.
Finally, other professional advisers will be a source of advice, and potentially business, such as Accountants and Business Banking Managers. Most banks produce information guides on setting up a business and many will have dedicated professional services managers who will look after legal firms.
Please do not hesitate to speak to the teams at CILEx and CILEx Regulation if you have any specific questions we can help with.