B is for Business Bank

B is for Business Bank

B is for Business Bank – A to Z Accountancy Top Tips

This discussion crops up so often with business owners asking do I need a separate bank account for my business?
If you are running a limited company, then yes, it is a separate legal entity and it needs a bank account to be set up in the company name.
It is not compulsory for Soletraders and Partnerships to have a separate business bank account to your personal one. So many businesses just use their own. However, there are massive benefits to having one;

Top Tips

  1. Means your record keeping is so much easier – you don’t have to wade through all your pub rounds and online purchases you know all the transactions are business related.
  2. You don’t over pay tax by including a salary taxed elsewhere.
  3. You don’t over pay tax by missing expenditure that wasn’t clear.
  4. You can use it to save for tax bills ensuring you always have a buffer saved.
  5. Customers and Suppliers have the right details from the start. You might be starting up and think ‘oh I’ll change it if the business gets bigger’ but then you have a lot of changes to make when you get to this point.
  6. You can easily keep track of the business cashflow with a better understanding of what’s coming in and going out and the basic overview of the financial health of the business.
    The same goes for your personal finances too.
  7. You can accept card payments.
  8. Build a business bank relationship / credit to get finance.
  9. Often it looks more professional.

So, in summary, you need a separate business bank account 😊

Thank you for reading this weeks blog – B is for Business Bank, see you next week.

Flo

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