Starting A Translator Or Interpreter Business: Legal Considerations You Need To Know

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Overcoming language barriers and successfully communicating with others is a necessary skill in today’s world. Often, this means needing to talk, listen or read in a language that you aren’t familiar with.

This is where translators and interpreters come in.

When you’ve hit a wall, another person with the right language skills can be a life saver. And as an interpreter or translator, you’ll be providing others with an indispensable service. However while you’re out there helping everyone else, it’s imperative that you keep yourself protected as running your own business as an interpreter or translator means there are certain risks you’ll be exposed to.

No need to worry though – with the right legal considerations, you’ll be able to keep your business safe and focus on your clients.

Keep reading to learn more.

Registering And Operating Your Business Legally

Whether you’re operating as a freelance translator/interpreter or you’re doing this as a full-time day job, it’s crucial to make sure your business is properly registered.

Registering your business involves choosing the right legal structure for your business as a translator or interpreter. Ordinarily, business owners tend to register their business as a sole trader or a company.

These are two different types of business structures, which we’ll explore in more detail below.

Sole Trader

As the name implies, a sole trader is a business structure where an individual is completely responsible for their business. Key features of a sole trader business include:

Easy and simple set-up process
Little to no upkeep or management of the business structure
All liabilities fall on the business owner
Requires an Australian Business Number (ABN)
Business name may need to be registered
Sole traders will need to apply for any relevant taxes

When you’re a sole trader, your business is personally attached to you. As there is no legal separation between the business and you, everything that happens with the business belongs to you – this includes profits, debts and liabilities..

To set up a sole trader business, simply go online and apply for an Australian Business Number. Don’t forget to Register a Business Name if you’re using a name that is different to your personal name. While you’re at it, it’s also important to apply for any relevant taxes.

As you’ve probably noticed, setting up as a sole trader is relatively simple. While this may be attractive for many business owners, it’s also vital to keep in mind that a sole trader set up doesn’t provide you with much legal protection and it may be worth considering other business structures such as a company.

Company

A company is a legal entity on its own, which means your business won’t be attached to you personally as it exists as a separate legal ‘person’. Key features of a company include:

A more demanding set-up process
Consistent upkeep and management of the business structure
Limited liability of the company owner
Requires an Australian Business Number (ABN) and an Australian Company Number (ACN)
Business name may need to be registered
Company owners will need to apply for any relevant taxes

Companies are regulated by the Australian Securities and Investments Commission (ASIC), so there’s a few rules you’ll need to follow to Set Up A Company. It’s best to have a legal expert help out with this process so you can be sure the set up is done correctly.

You don’t need to be a big enterprise with a lot of investment or a big team to set up a company. Rather, you can choose to run a company as a single, freelance translator or interpreter. Although setting up a company takes more time and resources, it offers more legal protection to you as a business owner which is always a good thing.

If you’re having trouble deciding how you want to set up your interpreter/translator business, our legal experts are happy to chat and clear up any questions on your mind. To learn more about the different kinds of business structures, click here.

Getting The Right Contracts To Protect Your Business

The next step to secure legal protection for your translator/interpreter business, is to have the right legal agreements in place. Legal documents can protect your revenue streams, limit your liabilities, set the tone for your working relationships while allowing you to maintain confidentiality where necessary.

It’s all in the details of a well-drafted document (that is written by a legal expert). A few contracts that are worth considering for your translator/interpreter business include:

Service Agreement

A Service Agreement is the contract between a service provider and their clients. As the service provider, you will need to agree on important matters with your clients like payment, scope of work, liabilities and termination of the contract. It’s also crucial that both parties understand what their rights and obligations are in accordance with one another. That way if there’s ever a misunderstanding, the contract can always be referred to.

Website Terms and Conditions

If you’re going to be operating your business online (more on this later), then it’s important that your website has robust terms and conditions in place. Website Terms and Conditions are a set of ground rules that lets anyone interacting with your business’s website know the rules for using it. Terms and conditions can help you maintain control where necessary and limit your liabilities, as well as establish rules on matters like payment and conduct.

Non-Disclosure Agreement (NDA)

Keeping things private can be a necessary requirement for any business. However, sometimes you can’t work on promises alone – which is where an NDA comes in. Whether you’re trying to keep something private for your clients or you’re asking another party to maintain a level of secrecy for you, getting it in writing is crucial. If something does get out that shouldn’t have, you’ll know that you’ve got the right legal documents to back you up.

Keep in mind, we’ve compiled a general list of key legal documents for you in this article. Talking to a legal professional can help you determine the exact legal documents you will need to get for your specific business.

Operating Your Business Online: Are You Taking Care Of Your Data And Privacy Requirements?

Operating online is a great way to connect with a broader audience. After all, translating and interpreting doesn’t necessarily require you to be physically present at all times.

However, the online landscape exposes your business to certain risks. So when you operate your business online, it’s important to use the right legal instruments to reduce these risks.

How exactly do I protect my online translator/interpreter business?

One of the first things you need to be aware of is Australian privacy regulations. The Privacy Act and Australian Privacy Principles (APP) require any business that collects the private information of its website users to have a Privacy Policy on their website. Private information can be any information your website users give that can identity them, such as their:

Name
Email address
Phone number
Bank details
Address

A privacy policy needs to meet certain legal requirements, and getting the help of a legal professional in creating it is essential.

When you collect information from your clients and potential clients, you also need to ensure you have taken reasonable steps to make sure that it has been secured. This means ensuring all your systems are well protected and up to date.

However, we understand that sometimes even the most airtight security can be breached. If this happens, your response is crucial. Having a Data Breach Response Plan in place prepares your business to have a more efficient response, such as quickly notifying the right people and getting your systems all back on track.

A Data and Privacy expert will be able to determine what the right documents and processes are for your business. We recommend getting in touch as soon as possible as protecting your business data and privacy is crucial and you can face heavy penalties for non-compliance.

Regulatory Compliance As An Interpreter Or Translator Business

There’s a number of other laws your interpreter/translator business will need to follow in order to be a business that functions in line with the law. Regulatory Compliance is essential to prevent heavy legal penalties and hits to your good business reputation.

Since you will be providing a service, it’s important to familiarise yourself with the Australian Consumer Law (ACL). The ACL is the main regulatory body that protects consumers and small businesses. As a service provider, it’s vital to understand what your obligations are towards all your clients, such as offering them fair rates, good quality services, refunds where necessary, being transparent, and making sure all your business practices are fair overall.

As we noted, the ACL also protects small businesses. For instance, significant changes taking place in November 2023 regarding unfair contract terms serve the purpose of stopping small businesses from getting taken advantage of. You can read more about these changes here.

Regulatory compliance also means you need to have the right qualifications in place before you start your translator/interpreter business. In Australia, the National Accreditation Authority for Translators and Interpreters (NAATI) is the main and only authority that can provide the right certifications so it’s important to ensure you’ve got the necessary qualifications. If you plan on hiring employees, make sure their qualifications check out as well.

What About My Intellectual Property?

Another key legal consideration for your translator or interpreter business needs to take into account is Intellectual Property (IP). A mistake many business owners make is not securing their intellectual property fast enough. For example, if you have a logo or a business name that’s integral to your business’s identity, then it’s imperative to get registered as a Trade Mark as simply registering it does not give you ownership. This way, you will have legal ownership over it. This can help secure your business’s identity and prevent others from imitating your business.

Even if you don’t have a trade mark that needs to be registered, there’s other ways to secure your IP with legal instruments. A few legal agreements that are useful in safeguarding your IP include:

The legal instruments used to protect your IP will depend on the IP itself. Remember, without the proper legal protections in place, it can be difficult to claim the legal rights to your IP after someone else has unfairly used it. This is a common mistake that, unfortunately, many business owners tend to learn the hard way.

You can read more about the most common legal mistakes made by business owners in our article, Top 3 Biggest Legal Mistakes Australian Startups & Small Businesses Make In 2023 written by Sprintlaw co-founder, Alex Solo.

Next Steps

Starting your own business is an exciting step in your career as a translator or interpreter, however it’s important to take care of all the legal considerations so you can set yourself up for success. It can seem like a lot at first, however the right legal help can make this process much simpler so you can focus on providing quality services for your clients. To summarise what we’ve discussed:

Translators & interpreters play a crucial role in overcoming language barriers
Legal considerations are essential for protecting your interpreter or translator business
Business registration is necessary, with options including sole trader & company structures
Sole traders have a simple setup but offer limited legal protection
Companies require more effort but offer better legal protection
Legal agreements including service agreements, website terms and conditions and non-disclosure agreements are important for your business
Operating your business online requires compliance with Australian privacy regulations, and having the right legal instruments in place, such as a privacy policy is crucial
Regulatory compliance involves adhering to the Australian Consumer Law and NAATI qualifications
Securing intellectual property (IP) is crucial for business identity and protection as failing to protect IP can lead to costly legal issues
Protect your IP by registering trademarks and using legal agreements like copyright disclaimers, domain name licences and IP licences
Seek legal assistance to navigate these considerations and ensure your business’s legal compliance

If you would like a consultation on starting a translator or interpreter business, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.

Sapna Goundan

Sapna has completed a Bachelor of Arts/Laws. Since graduating, she's worked primarily in the field of legal research and writing, and she now writes for Sprintlaw.

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