Business account advice - use same banks as personal account?

chuckylefrek

Hi there

I am in the process of setting up a limited company after operating as a sole trader for the last 8 years. I have up til now been just using my personal bank account with Barclays for both personal and business use and asking all clients to make cheques out to my name rather than the business name.

I believe I now need to have a business bank account as a requirement of a limited company so would appreciate advice on what is the best offer at the moment.

My business is website design and games programming and I generally get about 2 to 5 cheques a month - the total amount being in the region of £2000 to £5000 (not that often!) a month.

I am not sure if it is advisable to use the same bank that I have my personal account with or it makes no difference.

I live in a village and don't tend to go into town often so ideally I can pay my cheques into the local post office but this is not essential.

Any advice much appreciated!!

Thanks

Paul

Tallymanjohn

I use same bank for business and personal mainly because I've been happy with the service I got prior to setting up business & it was a lot easier to do as they already knew me. Had to negotiate initial period of free banking which was easy enough & it means I can do all of my on-line banking & in-branch banking at the same time. I think it's a case of 'better the devil you know', if you are happy with your personal bank.

chuckylefrek

Thanks for the reply.

The main reason I was thinking of a different bank is that I heard the Barclays have alot of charges for business banking whereas other banks do not appear to do so.

WHA

Have a look at Cater Allen's reserve account:-

http://www.caterallen.co.uk/index/capb-s4b/capb-s4b-ra.htm

This is designed for "professionals" who have few transactions and don't need to bank or withdraw cash. It is a postal account, so you just send your cheques received in the freepost envelopes they provide. It also has the usual features such as cheque book, paying in book, ability to pay direct debits, standing orders, etc. It doesn't have any overdraft facilities though. They don't yet do internet banking, but that is planned shortly and their telephone banking is very good (no waiting in queues and no foreign call centres).

Ignore the minimum balance requirements shown on the website, many accountants have a special arrangement with them where the minimum balance is waived and where the quoted interest rates are actually 0.25% higher than advertised. (Ask your accountant if they have this arrangement with Cater Allen or pm me for details).

Cater Allen is part of the Abbey group but is operated completely separately as a stand alone company with different premises, systems and staff, so you get the safety of being backed by a major bank, without the problems of the Abbey call centres.

feelingblue

Hi there,

My hubby looked into 'business banking' a short while ago as he too uses a current account for his finances.

We found that Alliance and Leicester had free business banking (although do look into terms and cond - we all know about the small print!). Not sure if this is still right.

However, we did find that other banks wouldn't give the overdraft that my hubby needed so we had to stay with the bank he has been with for over 40 years - bit of a catch 22 situation. So if you do need a substantial overdraft check that they will give you it first!

Good luck.

powerbase

I use abbey and they are free but there are limits on the freeness. My payments are all electronic and there are no charges for that. Cheques may be different. A&L I hear are also good.

I would check out both their websites and see if one suits you. Sorry I cannot give you more details but 5 minutes looking up the sites should tell you everything you need to know.