When it comes to the financial aspect of your company, it is helpful to set up a business bank account so that all the money coming in and out of your business is accounted for. It can get confusing to merge your personal account with your business income and outgoings. Read on to find out everything you need to know about Business Bank Accounts.
What’s the difference between the two?
Like a personal bank account, a business bank account can also offer:
- Cash and cheque handling allows you to deposit and take out money
- A debit card, and an overdraft
- Online banking so you can track your account at any time
- Professional advice from your banking institution
However, different services for Business Bank Accounts include:
- Paving the way for your business to borrow money. There are times when you may need to renovate your area of work, refund clients or even just for initial investment.
- Get a business credit card- sums of money towards your business costs which you pay back later given that you have a good credit history
- Take card payments from customers – banks take a fee each time a customer chooses to pay with card/contactless transactions. However, this varies with different banking firms.
- Accept deposits (over-the-counter cash, checks, credit card and electronic)
- Pay for Business-related expenditures (payroll, taxes, business insurance, vendors, lenders)
- Process salary payments – make it easier to transfer salaries from one specific account into your employees’
- Carry out credit checks on businesses and suppliers you work with. This way you can make informed decisions about whether to work with them
Is it a legal requirement if you own a Business?
There is no legal requirement for a business operating as a sole trader to have a separate business account, however, it is highly encouraged due to the reasons stated above. It helps you keep a detailed record of all your expenses, as well as managing transactions and loan benefits. You should also seek professional advice on whether using a personal account for your business complies with your bank’s terms and conditions.
How we can help
Here at Carrington Blake Accountancy, we help businesses with financial advice tailored to their unique requirements. We save our clients the trouble of financial stress and we enable your business to grow with our advice.
To find out more about accounting services, contact us today on 0207 537 6628 or leave us an email at firstname.lastname@example.org. If you have a question or would like further information, why not chat with us now?