UK business credit card

[altyfc]

Hello all,

For my business, I currently use a personal credit card which is paid in full monthly by direct debit from my business account.

My business is going Ltd., and I'm told that I must now have a business credit card as opposed to a personal one that deducts funds from my business.

Can anyone recommend anyone for a business CC? I like to pay my balance in full each month so if there are any with cashback options, that's probably the most attractive to me...

Thanks for any pointers

Aaron

[Ozzy]

Hi Aaron,
You can use whatever credit card you like for your business.

For example, I use a personal BarclayCard for all business use so that I collect Nectar points ;) I now have enough Nectar points for a weeks holiday in France for my wife and I !

So long as you only use that card for business only transactions to keep things tidy it will be fine - subject to the card issuers T&Cs ofcourse.

[Alpha]

Whilst you can use any credit card you do realise that anything purchased in this way is supposed to be recorded on a p11d!!! The potential penalty for an incorrectly filed P11d is £3000.

Also when the EEC ruling on vat is applied by UK customs it is quite possible that you will not be able to reclaim the vat on any of those purchases because the supply is made to you (a non vatable entity) not the company. We are awaiting HMRC's release on this.

Thought I'd brighten up your day Richard :D

[Ozzy]

Gee thanks! I did run this by my accountant who stated that I must only use the card for business transactions and nothing more, which I am abiding by. I'll run this by him though to be sure.

[MartinC1970]

Aaron,

Most banks issued a business card.

For example, HSBC issues a business card that carries the MasterCard symbol. A monthly statement is produced and the full balance is debited 10 business days from the statement date to your nominated HSBC business current account. The annual fee for the card is £20 and no interest is payable as payment is made in full each month.

This allows for business purchases to be kept separate from personal expenditure, and also avoids the other problems mentioned earlier in the forum.

Let me know if you need any further details.

Regards.

[Romperstomper]

Alpha,

You mention above that "you can use any credit card you do realise that anything purchased in this way is supposed to be recorded on a p11d!!!"

Please can I ask for an explanation. Surely if a business expense (for example web hosting costs) is incurred on a personal credit card then reclaiming the payment of expenses cannot have any influence on the P11D.

Otherwise people working in jobs for big companies would have P11Ds that include costs relating to business expenses but this of course is not the case.

Am I missing something or have I got the wrong end of the stick?

[Alpha]

I'm afraid that is the case and companies that do not do it are potentially storing up problems.

If the expense is invoiced to an individual and is then subsequently reimbursed by a company the expense should be declared on form P11d and then reclaimed as a business expense usually by making a claim on the individuals self assessment form.

A prime example of this is mobile telephone calls. When the telephone is purchased by a company and all calls invoiced in the company name there is no longer a P11d benefit (formally £200 although sveral years ago now). If the employee owns the telephone and is then reimbursed by the company the reimbursed amount should go on form P11d and the costs reclaimed by the employee on his Self Assessment, HOWEVER, It is only the cost of business calls that can be reclaimed NOT the rental as this is not 'Wholly and neccesarily' for the purpose of the business.

Of course the other possible reasons some large companies do not fill these in on a P11d is that they have dispensations in place on the basis that they have agreed with HMRC that all expenditure is business related.

[fastfences]

Hi Aaron,

Aaron,

Most banks issued a business card.

For example, HSBC issues a business card that carries the MasterCard symbol.


I use this card and I find it excellent. Having all purchases on one statement is good for both us and the accountant. Also, the debiting of the total card amount from your main account is counted as onlu one transaction and therefore avoids multiple fees. cheers, Nigel

[Anonymous]

there are serious problems with using a personal card for business purchases. Your credit card company have to underwrite your purchases under the sale of goods act. Many will not be happy to do this if you are buying for business. Also if the company is limited then it is a separate entity in law, and technically you are buying, then transferring ownership, so there are likely to be VAT problems.

Honestly you are better off getting the bank charge card and keeping everything simple.