Sole Trader & Bank Account

eskbanker

mrsmoneyworries wrote: »

I have done it again - I should have asked if I could legally do it.

It's not a legality issue as such, it's a question of whether what you do is in breach of the commercial agreement between you and your bank, as governed by the contractual Ts & Cs.

mrsmoneyworries wrote: »

I cannot find the T&C's of the account, so may have to ask the bank to send me them again.

You might raise some suspicion by doing so, are you sure they're not published online?

According to various other entertaining threads elsewhere on these forums, you probably won't have long to wait before another (changed) set is issued anyway!

agrinnall

mrsmoneyworries wrote: »

I have done it again - I should have asked if I could legally do it.

I cannot find the T&C's of the account, so may have to ask the bank to send me them again.

The law isn't going to care what accounts you have (other than conforming to AML rules), so it is the T&Cs that matter. I'd be surprised if the ones for your account are not available online.

antrobus

mrsmoneyworries wrote: »

Can a Sole Trader have just a normal Current Account, instead of a Business Bank Account?....

Yes.

But you will find that the T&Cs of every personal account will have some stipulation regarding business use. For example; Nat West state that personal accounts must not be used for business purposes, Lloyds state that they should by used for business purposes without their consent.

Despite this, plenty of people do indeed run their businesses through a personal account. I suspect that banks are quite well aware of this, but don't really care that much, so long as the level of activity isn't ridiculous.

And I doubt that you would get 'into trouble' for so doing. The worse that would happen is that the bank would close the account. But they're more likely to invite you for a chat and explain that you really need to open up a proper business account linked to their business tarrif.

polymaff wrote: »

Gosh! I wonder how many accountants would be happy to engage with a sole trader with multiple bank accounts.

Err, all of them.

Some sole traders have very complicated (and often very pointless) banking arrangements. Accountants are happy to engage with any sole trader as long as they are willing and able to pay the fees.

mjdh1957

I was self-employed for nearly thirty years and used my personal bank account with no problems.

I was a freelancer with a smallish number of regular clients so it was just a matter of paying a few cheques in each month, or later on receiving a similar number of bacs transfers. It might be more difficult if you are running more of a 'business' with buying costs and premises to rent.

polymaff

bigadaj wrote: »

Well you'll upset polymaffs accountants if you do!

Anything that looks like money-laundering would upset a good accountant.

polymaff

antrobus wrote: »

Err, all of them.

Some sole traders have very complicated (and often very pointless) banking arrangements. Accountants are happy to engage with any sole trader as long as they are willing and able to pay the fees.

It's not a matter of being "willing and able to pay the fees" - but of whether they actually WILL pay the fees. If they are ready to do such dodgy things as are being described here to avoid bank charges, I'd have little confidence that MY fees - including those involving MLR-related work - would ever be paid.

bigadaj

polymaff wrote: »

Anything that looks like money-laundering would upset a good accountant.

Having two separate current accounts doesn't really look like money laundering now does it, otherwise most if the regulars in this forum would be inside.

Keeping personal and business soend separately would surely be sensible, or would that good accountant be suggesting that their client tries to write off their weekly food shop as a business expense?

polymaff

bigadaj wrote: »

Having two separate current accounts doesn't really look like money laundering now does it, otherwise most if the regulars in this forum would be inside.

Keeping personal and business soend[?] separately would surely be sensible, or would that good accountant be suggesting that their client tries to write off their weekly food shop as a business expense?

Seems like you're suffering from thread-drift, bigadaj. This is a discussion about using a personal account as a business account, not about the undoubted merit of keeping separate personal and business accounts.

And good accountants spend their time trying to stop their clients from attempting to launder their weekly food shop as a legitimate business expense.

bigadaj

polymaff wrote: »

Seems like you're suffering from thread-drift, bigadaj. This is a discussion about using a personal account as a business account, not about the undoubted merit of keeping separate personal and business accounts.

And good accountants spend their time trying to stop their clients from attempting to launder their weekly food shop as a legitimate business expense.

Not really, your original comment suggested the OP would be doing something wrong by having an additional account.

Everyone is agreed that most banks terms and conditions prelude personal current accounts being used for business, but this doesn't stop many people doing it, and so long as the OP is aware of the risk then it's up to them.

They could of course pay for a business account as an alternative.

polymaff

bigadaj wrote: »

Not really, your original comment suggested the OP would be doing something wrong by having an additional account.

Oh, yeah? Please quote!

bigadaj wrote: »

They could of course pay for a business account as an alternative.

Which is the underlying issue.