Business Bank Account or Personal Account

[Djfreema]

For a new start up I am debating between using a business account or using a personal account.

There is no legislation which says I should use a business account and these accounts are hardly free (after 1 or 2 years), but the rates on personal accounts are much more attractive.

What do you think?

 

[Astaroth]

If you are going to be a sole trader then it is down to the T&Cs of your bank account. I am not a legal expert but I imagine that a ltd company would have to have a seperate account (and the bank would want it to be business) as it is a legal entity in its own right

 

[Real World Hypnotherapy]

Get a business account from the start, it makes it much easier later on.

They are free if you work it correctly. For example I use Barclays and I also have a personal account with them. It is free to pay money in and out online, and I only get charged for paying in cheques etc at the till.

To get round this you can pay cheques into your personal account and then move them online for free.

Also if you are sending cheques etc, it looks much better to have a business name on there rather than just your own.

Plus with seperate accounts you know what money is your and what is the businesses.

Matt

 

[epiphany]

A lot of business bank accounts are free with little charges here and there for stuff like cheques, I certainly don't recall many having start up fees when I started out. I would say start as you mean to go on, at the least it will make your accountant happy.

 

[Real World Hypnotherapy]

Also I would set up a high interest account such as an ISA and pay your tax and NI into it throught the year. This way you will have it to hand when you need it and you also make some nice interest.

Matt

 

[Deleted member 3454]

I didn't have a business account when I raised my first invoice and despite a request to pay me in my personal name I received a cheque in the business name and had to open an account asap.

I also had to pay in a personal cheque to open the account with the minimum balance, even though the cheque I had received was three times the required amount for opening the account.