The Law and Your Cake Decorating Business

It is said that there are only two certainties in life - death and taxes. I don't have any help to offer regarding the former (except don't eat too much cake), but there are a few things to consider in regard to the taxman, and his cousin the health department, when you are starting a cake decorating business.

The Taxman You cannot avoid him, so don't even bother trying. If you are generating income of any kind, then you owe some to the government and they are more determined to collect it than Tony Soprano (and more ruthless and powerful.) It is far better to research their requirements as part of the process of setting up your cake decorating business than to ignore this and find yourself in trouble (expensive trouble!) some time later. Tax regulations vary all around the world, so don't make assumptions. Call your local department and ask what you need to do. They all have staff whose job it is to make this as straightforward and painless as possible, so take full advantage of this service (which your tax pays for.)
In yesterday's post I mentioned the importance of keeping up with your paperwork - tax paperwork is the most important part of this. All of your business related expenditure is deductible, so if you are onto it from the start, you won't miss out on any claims.

The Health Department Health regulations vary even more widely than tax rules between jurisdictions, so check out your local requirements. There will always be rules as to what you can and cannot do with a food based business, so be very careful here. You may find that you need to work from a registered kitchen - your own, or rented space in commercial premises - or that there are restrictions on which type of ingredients can be used at home (usually depending on their degree of perishability)so be as strict on yourself as the authorities will be. This is a safety issue after all - who wants to make their clients sick because they didn't adhere to food safety standards? You may not even be aware of the potential for certain hazards, so do your research thoroughly and protect yourself as well.

Commerce department and insurance Most commerce regulations relating to a cake decorating business are covered by tax and health department requirements, but it pays to check this anyway. As for insurance - this is more a matter of personal choice, although some jurisdictions may require you to have public liability cover. Of course, your premises and whatever vehicle you use for deliveries are a valuable part of your business, and insurance of these is essential. It is also a good idea to find a reputable company that covers you for loss of income in the event of accident or illness. This is particularly important in the type of business in which you are either the sole employee, or the most important one.

Finally - if you need a reminder of the importance of staying on side with the taxman - remember that no-one is immune to his peculiar charms. Even the rich and legendary are subject to his demands - like the Beatles, for instance - whose own experiences led to the writing of one of their most popular (and cynical)songs, and naming it after him. Check out the You Tube clip, and check in tomorrow, when I begin a 3 part series on promoting your cake decorating business.