Business Bank Account

[Greenmantle]

I set up my second new small business last week. Did the incorporation on the Companies House Website. This will be a very small operation which will just about attract VAT. I was wondering to make things simple whether I could just create another current account under my personal banking online system and use that for all business receipts and payments. Shoot me if I am totally wrong but I read that it wasn't a legal requirement to have a business bank account.

I will not be using any banking facilities offered to most businesses and I have been operating my current business for 20 years without any issues albeit with a free business banking account. I just want to have free banking and keep things very simple.

John

[Jockman]

Do you mean you will hit the vat threshold of £82k? Is that very small?

Have you had free banking for 20 years?

[williamp]

Wrong I'm afraid. An incorporate business "limited" is a separate legal entity and must, therefore have its own bank account. Not a personal account used for business, but a recognised business account. A sole trader does not legally need a separate business bank account (although its a good idea to)

[dartissimus]

Virtually all banks offer a free banking for new business accounts for 12 months & sometimes more.

After that it's £6.50 per month'ish, and if it's all online, no further charges.

I too hate paying bank charges and am trying to stop wasting time/money getting the cheapest deal.

The only thing that keeps me from ignoring it all is the 0.085% handling charge for paying cash in. This is, of course more interest than they pay you in a year.

Maybe try looking at Santander, OK until it goes wrong and then it's terrible.

[Bristol spark]

I have a business account with HSBC, there is no monthly fee and back transfers are free, only pay for cash or cheque deposits.


I pay cash or cheques into my personal account and transfer into business account.

Free banking

[Mandat]

Bristol spark said:

I have a business account with HSBC, there is no monthly fee and back transfers are free, only pay for cash or cheque deposits.


I pay cash or cheques into my personal account and transfer into business account.

Free banking

I presume that your business cheques are made out in your name, and not in the company name?

[Greenmantle]

Thanks for all your replies
Yep Had free banking for nearly 20 years (19)
I knew that most mainstream banks were offering 12 / 18 month free deals. I just wanted to tie in a free deal for life now since 12 months flies by when you are busy.
I am already with Barclays so might ask them again.

John

[hajaba123]

Like many on here you appear to be misunderstanding the differences between a limited company and a sole trader. You really need to understand this to ensure that you fulfill your legal obligations as a director of your incorporated business (assuming you are a statutory director)
To answer your question, no, you can't run a company through a personal bank account

[AJXX1]

I'd suggest Santander.

I run a fairly low turnover operation - applied to Lloyds, HSBC, Barclays and Santander asking for a bobby basic business bank account - found all of them other then Santander to be a complete and utter fanny about getting anything done. They wanted references, extensive business plans, forecasts, meetings etc...

Barclays even invited me to a meeting with the local branch manager and advised to bring 5 and 10 year forecasts along with a comprehensive business plan for a "business review session". Err...no thanks Barclays, I asked for a basic bank account NOT a one to one to discuss the ins and outs of my business.

I can understand there's some level of risk involved and I'm not adverse to giving them details, but for a bobby basic bank account with no credit this really is overkill.

Santander had the account open and details on the way before any of the others could even be arsed to acknowledge the application.

Edited by AJXX1 on Tuesday 19th July 18:15

Edited by AJXX1 on Tuesday 19th July 18:16