Business Ac needed or Not?

edited 30 November -1 at 1:00AM in Small Biz & Charities' MoneySaving
19 replies 820 views
raf300raf300 Forumite
21 Posts
Hi

I have a question on whether a business account is needed as a sole trader/self employed?

The reason I ask is because I was thinking of starting a business. In fact HMRC have said if I go ahead with my plan I need to register as self employed. .

If I do decide to go ahead with my plan I would like to keep all the business stuff and payments I receive seperate from my personal accounts.

Therefore is there a need to have a business account or will another current account be okay?

What I need is basically to be able to receive payments, also to pay fees and website costs.
Eg Would it be best to get a seperate credit card for paying these sign on fees and website costs, or should I just use my personal credit card.

Any advice would be much appreciated.

Cheers
«1

Replies

  • Lots of people use a second current account for business especially sole traders. just bare in mind to be paid into your account any cheques would have to be written out to you & not your trading name (if using one)

    yes You could always use a current credit card for your business spending only from now on. but personally I would get another credit card to use solely for your business then there is no confusion with your personal accounts or credit cards !!
  • Mark7799Mark7799 Forumite
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    Advice I received from someone in the Revenue when I asked this question was that it was RECOMMENDED to have a SEPARATE bank account for business transactions as opposed to personal transactions but if that was actually a business account was your own choice. The Banks will obviously take a slightly different view....
    Gwlad heb iaith, gwlad heb galon
  • Thanks pagan705.

    So many things to learn and consider about starting a business, it is kinda of exciting and daunting at the same time.

    PS I can see why Business Acs and Personal are different. As you said, with a business you need to have the cheques made out to the business.
    Mark, I suppose Banks would take a different view as they charge for Business Bank ACs
  • I know what you mean :rolleyes:

    I've just sent you a PM
  • a lot have bank accounts have it in their terms and conditions that the accounta must be for personal use and not business
  • ukbill69ukbill69 Forumite
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    Your accountant will advise a business account and I would to. You can get free banking for life from some banks, others offer free banking period and you then have to pay a monthly fee of £3 and pay for cheque, bank transfers and other bits, but if going for a paid bank account then go for Barclay's as I have tried natwest, lloyds tsb, hsbc and none compare with barclays.
    Kind Regards
    Bill
  • Kilty_2Kilty_2 Forumite
    5.8K Posts
    The banks dont like you using a personal account but plenty of people do it. The main problem is that you need to have cheques paid to you and not your trading name, as stated above.

    I've had to return a couple of cheques since they were made out to my trading name and not myself. I don't have a choice though, can't get a business account because of my age. If I could, I probably would though, with Abbey since it's free, just to save any hassle.
  • The problem you is that if a lot of cheques are paid into a personal account the account can be looked into by the bank

    really depends on your turnover
  • martindowmartindow Forumite
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    As well as the big four banks which will charge after an initial free period you can get indefinite free business banking from Abbey and probably other smaller banks too.
  • and Bank of Scotland
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