It is nearly always advisable that you run your business finances through a business bank account, to ensure that your personal finances are kept separate, which should make your bookkeeping much more straight forward. If you are running a limited company, you must use a dedicated business bank account or you may be at risk of being taxed personally on the business income as it arises as if you had taken a dividend, salary or Director’s loan.


If you are new to the world of business bank accounts, you should play close attention to the charging structure, which may be:

  • a fixed monthly fee,
  • a fee based on the number of certain types of transactions each month (for example 20p per cheque banked in any month),
  • a fee based on the value of transactions banked (for example 1% of the value deposited in the month)
  • a combination of any or all of the above!

Many banks structure business bank account packages to suit certain types of business so it is well worth putting in the research to check which would be the lowest cost option available to you.

Don’t be seduced by the packages that promise free bank accounts for a set period of time, without first considering the long term impact of the fee costs. Once you have started up a business bank account it can be time-consuming to change it at a later date, particularly if you are using a card machine to take customer payments.

Quite often banks will offer you the facility to set up a free business savings account alongside your current account. While the interest payments for credit balances are unlikely to be anything to write home about, it is handy to be able to sweep excess funds into a separate account to ensure you have a savings pot to cover quarterly VAT bills, corporation tax bills or any other large outgoings you need to provide for. Most transfers between a current and savings account will be instantaneous so it can be a handy way to manage your cashflow.

Small businesses are also entitled to the £85,000 guaranteed savings protection per financial institution, so if you are likely to be accumulating funds in excess of this it is worth having more than one savings account with a different bank or better still have a chat with an independent financial adviser who should be able to help you make better use of your surplus cash.

Whether you are just starting out or have been in business for many years, we can advise you regarding the more practical aspects of running your business as well as the financial ones.