Business bank account being closed

Mistral001

spacemates wrote: »

Hi thank you to you both for time and advice I am self employed and I run a garage along with a online spares business so I have a lot of Internet money going through the account, I opened a business account thinking a normal personal bank account would not be allowed, but if it is then yippee! That's the light at he end of the tunnel I need! Thank you so much I had no idea I could use a personal account.

If you have a lot of business transactions going through your account then it is unlikely that you could use your personal account.

[Deleted User]

imoneyop wrote: »

Which is an opinion based on experience.

Can I ask, how much experience do you have of a bank closing your business bank account? :huh:

imoneyop wrote: »

Find another bank.

Did you even read the OP?

imoneyop wrote: »

No, they are valid reasons and from the fact that the bank gave him notice rather than just freezing the account immediately, I would say it is a commercial decision and they have decided that they don't want him as a customer, possibly because the account is regularly overdrawn.

How very assuming and judgemental !!! :mad:

imoneyop

darkfield wrote: »

Can I ask, how much experience do you have of a bank closing your business bank account? :huh:

None, but I have experience of closing business's accounts for both commercial and fraudulent reasons - perhaps you would like to present the extent of your experience of the subject?

darkfield wrote: »

Did you even read the OP?

Yes thanks, did you?

The only options the OP has is to find another bank or cease trading - you might not like that as a response, but unless he is going to go cash only and keep his cash under the floorboards those are the only options available to him.

darkfield wrote: »

How very assuming and judgemental !!! :mad:

How very uninformed and childish.

Yes, it is an assumption, but I'm not sure why you think it is judgemental - I'm sorry that my opinion doesn't match what you have decided that people should be telling the OP.

Since you don't seem to like people having an opinion that doesn't match youre, here is some factual information for you.

Here is an extract from a random bank's (Lloyds) Business account T&Cs.

12.9 We may terminate this Agreement immediately if any of the following occur:
a.if any information you have given us or give us in the future (whether in connection with this Agreement or not) is inaccurate;
b.if any material litigation is, or material administrative, criminal or judicial proceedings are, being taken against you at the time this Agreement is signed and you have not informed us in writing before entering into this Agreement (“material” means likely, if successful, to have any damaging effect on your business);
c.if you are a sole trader you die, become of unsound mind, become insolvent (or in Scotland, apparently insolvent) a bankruptcy petition (or in Scotland, a petition for sequestration) is presented against you, or steps are taken to appoint an administrator, judicial factor or similar officer to you or you apply to the court for a moratorium or make a proposal to creditors for a voluntary arrangement or you grant a trust deed for creditors or take any action (including entering negotiations) with a view to readjustment, rescheduling, forgiveness or deferral of any part of your indebtedness;
d.if you are a limited company or limited liability partnership, you have a petition presented or resolution passed for winding up or an administration order or a notice of intention to appoint an administrator is issued or notice of appointment of an administrator is filed with the court or you have a receiver appointed over all or part of your assets or you cease to trade, or you are deemed by law unable to pay your debts, or you make an application in connection with a moratorium or a proposal to creditors for a voluntary arrangement or take any action (including entering into negotiations) with a view to readjustment, rescheduling, forgiveness or deferral of any part of your indebtedness, including in Scotland granting a trust deed for creditors;
e.if you are a partnership (including a limited liability partnership) or unincorporated association, you dissolve or a petition is presented for an order to be made for the winding-up of the partnership or an application or a petition is presented or made for an administration order against the partnership;
f.if you are a limited liability partnership, any member ceases without our written consent to be a member or you cease for any reason to be a limited liability partnership;
g.if you fail at any time to meet any checks required by law or regulation;
h.if closure is required by the order of any court or direction or decision of a regulator; or
i.if you breach in a serious or repeated way this Agreement or any other agreement with us.
12.10 Subject to clause 12.9 we may terminate this Agreement by giving you at least two months’ written notice.
12.11 We reserve the right to require any account to be closed without giving a reason. This applies even if closure of the account results in a loss of tax benefits, and we will not be liable to compensate you for any loss of tax benefits or other consequential or indirect losses whatsoever and howsoever arising.

Obviously, we don't know which bank the OP is with and the T&Cs will be different, but largely the same.

A mixture of reasons for closing accounts. We'll have to assume that points 12.9 a, b and c don't apply.

12.9 d, e and f clearly don't apply as the OP is a sole-trader

12.9 g and h don't appear to apply - unless there is something the OP hasn't told us.
12.9 i - might apply, but the OP has given no reason as to why it would.

This just leaves 12.10 and 12.11 - which, since the account wan't immediately closed are the most likely.

Mistral001

May I step in here. The reason the OP's business account is being closed has not been given. It is his/her business.


Topics like this can bring up a general point that is perhaps worthwhile noting when we enter business. Banks are just another supplier of services to our business. They are a businesses that we do business with.

patman99

Just wondering if the OP were to register as a Limited co., whether they would have more luck getting a new account.

What about getting their spouse (if they have one) to open a business account in their name for him to use?.

CKhalvashi

patman99 wrote: »

Just wondering if the OP were to register as a Limited co., whether they would have more luck getting a new account.

Possible. I know that HSBC can bypass the personal credit checks for Ltd if no borrowing is required, but don't know about anyone else. This will require a personal reference.

Natwest also offer an account for those with past difficulties, as long as you haven't had issues with them in the past.

What about getting their spouse (if they have one) to open a business account in their name for him to use?.

This will probably cause huge complication with HMRC IMO.

The only other option would be for OP to have his OH/family member as a director, but himself as sole shareholder. My company has shareholders who aren't directors, and directors who aren't shareholders.

CK