having 2 current accounts instead of 1 current + 1 business?

Ashmil

Hi

Is there any reason for a small (part-time) sole trader to have a dedicated business account as opposed to a dedicated current account?

I mean, such a person could have a current account for personal, and also another current account for business?

Just thinking rather than having the full business account with fees etc, you could just have a current account instead, so no fees, and you could do the bank-switching thing for rewards every so often? for BOTH your current accounts...

Any thoughts?

Ash

eDicky

It's contrary to the terms of most current accounts to use them for business purposes. Why not open one or more extra current accounts for switching purposes.?

trailingspouse

Most business bank accounts are free for at least the first year of trading, some for longer. Even after the free period is up, charges don't have to be crazy - we get charged £6.50 a month for our account for a limited company (granted all transactions are either electronic or via debit card, no cash or cheques). If you're not making enough profit to cover those sort of charges you need to have a rethink.

Zanderman

Ashmil wrote: »

Is there any reason for a small (part-time) sole trader to have a dedicated business account as opposed to a dedicated current account?

I assume by 'dedicated current account' you mean a personal account you allocate (unofficially) for business use. That would be against the bank's t&c for the personal account and, if and when they work out it is being used for business (and they probably will work it out) they have the right to close it.

So yes, there is a reason for a trader, no matter how small their business, to have a business account.

If you find the fees (typically £5 or £6 per month plus small charges for this and that) too much you could try one of the app-only business accounts like Starling or Tide etc. Most have some drawbacks, mostly relating to paying in cash or cheques, but if you don't mind those drawbacks (which will probably be fixed in due course) you'll find most of them are actually free.