Avoid business bank fees

Watergirl

Moneysavingexperts own advice is to 'use a personal account if you can.'
http://www.moneysavingexpert.com/banking/small-business

Yes I am advocating it, as it's money saving and that is what this forum is all about after all.
IF you can find a personal account that allows it, or speak to a bank that is fine with some business transactions, as some may be able to use their discretion, there is absolutely nothing wrong with that.

The point I am making is that there is no LEGAL requirement to have a business account as a sole trader. So, if it was me (and it isn't - I have a business account as I own a limited company), then I would talk to a few banks and see who wanted my business. Just because something is in the terms and conditions, does not mean there is no room to manoeuvre.

The other alternative, which I've been looking into recently, as I'm sick of the ridiculous fees that I pay when I'm in credit with a high street account, is a free business account and using that for all business and personal transactions.

Zanderman

Watergirl wrote: »

Yes I am advocating it, as it's money saving and that is what this forum is all about after all.
IF you can find a personal account that allows it, or speak to a bank that is fine with some business transactions, as some may be able to use their discretion, there is absolutely nothing wrong with that.

MSE's advice to use a personal account is a little dodgy as it is, undeniably, against T&C.

Having said that many people do use a personal account for some business use and have no problem. But some have had their accounts closed. So it comes with a risk.

I doubt that any bank, if you asked whether you could use your personal account for business, would say yes (they don't seem to have 'discretion', just rules). And why should they? It would undermine the whole principle of the T&C and do them out of the fees they get from business accounts.

Surely the golden rule, if you want to use a personal account for business, is NOT to ask! Keep well under the radar!

This thread, by the way, is some months old, so offering advice to the OP might be rather pointless now.

If you want free business banking the only way, afaik, is to tart around for the free offers when they come up and switch to them. Yorkshire and Clydesdale have been offering 25 months free recently - and we're now with them for one of our business accounts. We will switch to a new offer, if there is one, when the 25 months are up.

Herbalus

Watergirl wrote: »

Just because something is in the terms and conditions, does not mean there is no room to manoeuvre.

I thought that was exactly what it meant? Otherwise the terms would say 'maybe' instead of 'no'?

Good luck trying to negotiate individuals T+Cs with the banks.

And I genuinely don't know of any banks that are happy with a customer having a bank account used for personal and business transactions. If you do find any, please let us know. I don't think you will, but I'm willing to be proved wrong

Watergirl

Well it seems everyone has a different opinion, but I'm gathering the two prior posters would not recommend attempting to operate under the radar!

I have terms and conditions with my company and sometimes negotiate. I think for a small business, which I'm assuming it is, with very limited transactions, it wouldn't be an issue and there are countless anecdotal stories online to suggest that plenty of people do it and are fine. Or have been turned down for a business bank account and have no alternative that to use their personal account with the bank turning a blind eye.

Anyway, yes I looked at Yorkshire and Clydesdale as well for my company, but my concern with the chopping and changing every 2 years or so is customers having my bank details and often not checking invoices for changes, but just processing the amount and using old details that are set up on their system. Appreciate I can inform them of the change, but don't want to have to do that every 2 years.

I did find one that I am sure was free for life, but cannot find it now. Will post back if I find it. How have you found the bank so far and the switching process Zanderman?

Zanderman

Watergirl wrote: »

I did find one that I am sure was free for life, but cannot find it now. Will post back if I find it. How have you found the bank so far and the switching process Zanderman?

I think the 'for life' one was Santander, and they famously changed the T&C to remove the 'for life' bit a year or two ago. And managed to annoy quite a lot of people in the process. (edited to add: FSB members can have free for life business banking at the co-op but you have to pay FSB membership fees to get it)

Yorkshire/Clydesdale were, sadly, extraordinarily slow to switch to - mainly because they took an age to open the account and the switch (the easy bit) couldn't happen until that was done.

The main caveat to take on board is that they have very few branches south of Yorkshire, so if you're based in the south you may not have a local branch. Not necessarily a problem (e.g.cheques can be paid in at the Post Office [I believe, haven't actually tried that yet]) but could be a problem for some transactions.

So far so good with the online facilities etc, but early days.

Re telling clients/customers about a switch, we don't have many incoming payments from clients via BACS or FP so changing account isn't a big problem for us. But the switch process does, of course, forward on any payments to the old account for a year or so, so you actually have quite a long period to notify people. Though you also need to have faith in that forwarding of payments system...

Watergirl

Thanks, never really go into a branch, and like you most payments are via BACS. Think it was Metro bank, but they're only down south. We're Midlandsish.

Sure there was one that was free for online only. Appreciate your feedback.

colsten

Watergirl, after all the further comments, I would like to repeat what I posted earlier.

colsten wrote: »

If you choose to ignore the T&Cs, despite having agreed to them, you are running the risk of joining all those who had their accounts closed at very short notice.

It doesn't matter if anyone else suggests it is ok to use a personal account for business. As the banks' T&Cs override any personal opinions of individual posters or journalists.

polymaff

Watergirl wrote: »

Well it seems everyone has a different opinion, ....

Actually, there seems to be a remarkable degree of agreement

jonesMUFCforever

This thread started due to a businessman/woman complaining about forex on a business account, then mushroomed to an argument about whether you need a business account or not.

Can I add that if you made exactly the same transactions on a personal account you would have been charged exactly the same amount in charges!

Watergirl I await your response?

Zanderman

jonesMUFCforever wrote: »

This thread started due to a businessman/woman complaining about forex on a business account, then mushroomed to an argument about whether you need a business account or not.

Can I add that if you made exactly the same transactions on a personal account you would have been charged exactly the same amount in charges!

Watergirl I await your response?

Actually this thread was dead, months old, until a spammer (whose post is now removed) posted here and brought it to the top of the list this afternoon.

Watergirl (I assume) saw it there and assuming it was a live thread asked a question of the OP (who presumably stopped reading the thread ages ago).

Everything since has been rather off-topic - and the original question about forex transactions has nothing whatsoever to do with recent posts.

Surely better just to stop posting, as it is getting a bit silly now.

This is my definitely last post on this thread!