What is a business account?
A business account is very similar to a personal account and offers a way to keep your personal and business finances separate. This type of account will be used for your business income and outgoings and can also help you with other financial business tasks, such as payroll, tax returns, and issuing invoices. There are some options available so you can choose the one that best suits your requirements.
Who needs a business account?
Essentially, you need to have a business account if your business is a limited company in the UK. This is because your business is seen as being legally separate from you, so it needs to be separate.
If you’re a sole trader, contractor, or freelancer, you don’t need a business account as you and your business are seen as being one entity. However, you can choose to open a business account if you think you’d benefit from having one.
The benefits of a business account
There are many benefits of having a business bank account, one of which is how much time it can save you. Rather than having to sort through your personal and business expenses, everything will already be separated and easy to report on. This will help with your tax return and ensure that you’re paying the right amount.
Having a business account can also make it easier to apply for business finance, as many lenders won’t offer finance to those using their personal bank account. Through having a business account, you can build up your company’s credit history which will make you more appealing to lenders.
Still wondering if you need a business bank account? Contact our expert team today for professional business advice!