Can I open a business bank account before registering my ltd company?

[LeeT]

Or do I need to register the business first?

 

[Gyumri]

You need to register the name first otherwise it doesn't exist as a legal entity.

 

[WaveJumper]

You could make use of this link here:

Business Bank Accounts

www.ukbusinessforums.co.uk

 

[LeeT]

Thanks very much the link, very helpful as it shows all the relevant info.

After reading some posts on this subject, I was looking at either mettle or starlingbank.com. I don't need a overdraft or credit. Just somewhere to store the millions I will soon be making ?

I need to register with companies house first so that will be my next step.

 

[MOIC]

Just somewhere to store the millions I will soon be making

Ahhh . . . . . trading in Iranian Rial or Vietnamese Dong?

You'll make your first million in a week, or less.

 

[PugwashEQ]

Just be aware that opening business bank accounts isn't as simple as personal accounts- banks are much warier of business accounts! We had all sorts of problems- and we are in a regulated industry, with no cash.

 

[LeeT]

Yeah, I thought this might be the case.

I will be paying in cash (for the 1st year at least) as well as transfers from Ebay and other selling platforms.

Will this prevent me from opening an account? If not, are any banks preferable to a small business that deals with both cash and cashless payments?

 

[PugwashEQ]

Hi Lee,

Realised my reply above was actually really unclear. Banks are wary of opening Limited Company Accounts. If you plan on being a sole trader you don't necessarily need a specific bank account- you can just use one of your private accounts. You may want a business account if you need specific business services.

If you aren't planning on being a limited company then that makes your life easier!

 

[LeeT]

Thanks, I haven't fully decided yet, still doing my research but it has been suggested a ltd company will be best for my situation.

I have contacted Staling Bank and explained my scenario. hopefully they will provide some clarity as to whether I can get one or not.

I suppose that will decide how I will be trading, if I can't get a business account, sole trader it will continue to be.

 

[MyAccountantOnline]

Thanks, I haven't fully decided yet, still doing my research but it has been suggested a ltd company will be best for my situation.

I have contacted Staling Bank and explained my scenario. hopefully they will provide some clarity as to whether I can get one or not.

I suppose that will decide how I will be trading, if I can't get a business account, sole trader it will continue to be.

Do make sure you make the right choice. I've seen so many people paying avoidable and unnecessary tax having not taken proper professional advice.

A thought (and I'm not recommending these banks) but if you do opt for NatWest, RBS or Mettle you'll get FreeAgent free which is great bookkeeping software.

 

[LeeT]

Thanks for the advice Nicola,

It's all helping me to make the right choice.

I did get a reply from Staling who replied:

Sadly at this time we would not be able to offer you business banking facilities for any businesses offering hairdressing or car detailing as they unfortunately fall outside the scope of businesses that we’re able to support at this time.

I think I may have to be a sole trader for this side of my business at least.

 

[Bob Morgan]

You also need a Plan B for when the Bank decide to close your account without reason!

 

[LeeT]

You also need a Plan B for when the Bank decide to close your account without reason!

Does this happen often? Or is this a personal experience?

 

[Ozzy]

if you do opt for NatWest, RBS or Mettle you'll get FreeAgent free which is great bookkeeping software

I can +1 on this, it's what my daughter and my wife use in each of their subsequent businesses and from the dabbling in FreeAgent I've done it's easy to use and comes free with the bank account.

 

[LeeT]

That sounds great and I am defo considering these, thanks.

 

[Bob Morgan]

Does this happen often? Or is this a personal experience?

It happens quite frequently, although it has not happened to me in the UK. There are a few threads to follow here on UKBF.

 

[clare_mcd73]

Hi Lee,

Realised my reply above was actually really unclear. Banks are wary of opening Limited Company Accounts. If you plan on being a sole trader you don't necessarily need a specific bank account- you can just use one of your private accounts. You may want a business account if you need specific business services.

If you aren't planning on being a limited company then that makes your life easier!

Hi,
I am glad to read this as I have applied to open a business account as a new Ltd company with Starling and HSBC (my personal bank) and have been refused. My personal credit rating is excellent, I have plenty of funds and am not looking to borrow money so I am confused and reluctant to try again without understanding the reasons for refusal. My new business is a lunch delivery service so I was keen to remain as a limited company for product / personal liability purposes. I have a separate account with HSBC from which I am managing my business set up costs so at least they are separate for now but wary that this could be shut down when (hopefully!) 30-40 transactions start to come in!