Do all bank accounts need to be with same bank ?

[VictoriaZaZ]

I've been a sole trader for years, soon to transition into a Ltd co. I can no longer use my Halifax current account for business purposes when this happens. I have to set up a proper business bank acc, but Halifax don't offer these. I will pick somewhere that works seamlessly with Xero, which means Lloyds and Bank of Scotland (part of same group as Halifax) are out.

Everything relating to a Ltd co is new to me. I understand I can set up dividends to be paid directly into a bank account instead of receiving a cheque. Is it ok to have these paid into a current account that is with a totally different bank to my business account ? Let's say I choose Barclays for the business banking but stay with Halifax for everything else …..is this ok or are you supposed to switch all accounts over to the one bank ? (Major hassle and I have been with Halifax for nearly 3 decades)

SECOND Q : I am likely to have a side line business with a sole trader set up - a different business to the Ltd co one and it will need it's own separate account. Can I stay with Halifax for that even if my Ltd co business account is with some other bank ?

Thanks

 

[STDFR33]

Yes and yes.

 

[Ian J]

Yes and no.

Halifax don't offer business bank accounts and that includes sole traders' accounts.

If you only receive a couple of payments a month you may get away with it but many more and they may notice and realise what you are doing.

When I started out as a sole trader I used my First Direct personal account and got away with it but others may not be as lucky

 

[KM-Tiger]

is this ok or are you supposed to switch all accounts over to the one bank ?

I was once advised by a solicitor to use separate banks.

He kept his personal, partnership, and client accounts with 3 separate banks. His explanation was that the bank's T&Cs would allow them to move money from one account to another, which might not be what you want.

Obviously only applicable in the event of difficulty, but that's exactly when you don't want the bank to act against your wishes.

 

[StevensOnln1]

You and your limited company can have as many different accounts with as many different banks as you like. Declaring a dividend involves some paperwork, but actually paying it is just an internet banking payment, the same as paying a bill.

 

[VictoriaZaZ]

Ok, thanks everyone.
Ian, there is absolutely no legal requirement to have a business bank account as a sole trader. Using a current account is perfectly legal. I wasn't trying to "dodge" anything , it is all perfectly legal.

 

[Ian J]

Ian, there is absolutely no legal requirement to have a business bank account as a sole trader. Using a current account is perfectly legal.

Of course it is legal but Halifax in common with many other banks do not offer business banking services and they even claim on their website that "At the Halifax, we don’t provide business banking services" and that is to sole traders as well as limited companies

 

[VictoriaZaZ]

Yes, I am aware. I bank with them and have for years but have to set up a business account elsewhere now. The only reason I need an actual business account now is due to the plan to transition to a Ltd company, so my hand has been forced .

 

[Glenn Martin]

If you need an account that works well with Xero look at santander there bank feed is brilliant and easy to setup as is applying for the account.