AI Legal Tools for UK Small Businesses (2026)
AI has made 80% of small business legal work obsolete at solicitor rates. AI drafts contracts, generates T&Cs, reviews agreements for risk, and creates NDAs in minutes — tasks that solicitors charge £300/hour for. The 20% that still needs a human (disputes, IP protection, complex negotiations) genuinely justifies solicitor fees. The key is knowing which is which.
Penny's take
AI handles routine legal at 1/100th of solicitor rates: contracts, T&Cs, employee agreements, NDAs, privacy policies — all generated and reviewed by AI for £20-50 each. Keep solicitors for the 20% that genuinely needs human expertise: disputes, IP protection, complex negotiations, and regulatory compliance. AI is your legal first line; solicitors are your specialists.
From my notebook
“A marketing consultancy was paying a law firm £750/month on retainer for "general legal advice." In 12 months, they'd used the service 4 times — all standard contract reviews. That's £2,250 per contract review. We cancelled the retainer, deployed AI legal tools (Rocket Lawyer AI, £30/month) for routine documents, and found a freelance solicitor for complex matters (£150/review when genuinely needed). AI handles 90% of their legal needs. Annual saving: £7,800.”
“Small businesses that use legal tech and template documents spend 70% less on routine legal matters without increased risk.”
— Law Society Technology and Practice Report, 2024
What affects the cost — and can AI replace it?
- •AI vs human for the specific task
- •Complexity of matter
- •Solicitor seniority
- •Location (London premium)
- •Fixed fee vs hourly
What Penny says
Penny identifies which legal needs AI already handles (contracts, T&Cs, NDAs, privacy policies) vs which genuinely need a solicitor (disputes, IP, regulatory). Most small businesses can shift 80% of legal work to AI tools at £20–£50 per document — keeping solicitors for the 20% that matters.
Ask Penny about AI alternatives →Frequently asked questions
Can AI replace a solicitor for small businesses?
For routine legal (contracts, T&Cs, NDAs, privacy policies, employee agreements) — yes. AI legal tools draft, review, and customise these documents in minutes for £20–50 each. You still need a solicitor for disputes, IP protection, complex negotiations, and regulatory matters. AI handles 80% of typical small business legal needs.
What AI legal tools are available?
Rocket Lawyer AI and LawDepot generate customised legal documents. Harvey AI and Luminance review contracts for risk. ChatGPT can draft basic agreements and explain legal concepts. For routine needs, these tools cost £20–100/month vs £150–500/hour for a solicitor.