Question:

I am a freelance graphic designer operating as a Sole Trader. I currently have a business bank account but am not happy about paying bank charges now that I am outside of my free banking offer. Do I have to use a business bank account ?

Answer:

Sole Traders do not need to have a business specific bank account, it is perfectly fine to just use a current account, as long as your bank lets you.

We would always advise having a separate bank account for your business so it keeps your personal transactions away from your business ones, but it is fine for this to be a separate current account.

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If you have a lot of business transactions going through the account some banks will insist that you open a business account but in reality this rarely happens – it might be more of an issue if you are running a business that has hundreds of transactions each month but our experience of working with graphic designers (we work with a lot of creatives) is that there are usually no more than 20 or so transactions each month, so in reality your bank is not likely to make an issue of it.

Please note that this advice is just for Sole Traders – if you run a Limited Company you must open a bank account in the name of the Company as this is a separate entity to you personally.

If you do have a lot of business expenses going through your bank account then you might want to consider trying out FreeAgent for free which is an amazing online book-keeping system.