Compare business bank accounts online

You’re not legally required to have a business bank account if you’re self-employed or a sole trader but many people choose to, as it helps keep business and personal finances completely separate and easier to manage. 

On the one hand, it will be easier to separate personal and business transactions when it comes to filling in your tax return. However, you are unlikely to find a free business bank account, so you will need to factor in the cost of the monthly fees.

How much you can pay into your business bank account depends on the bank and the account you have with them, but almost all will have a set minimum and maximum balances. If you need to increase your balance you can often apply to your bank to do this.

Yes, although you may be charged a handling fee and sometimes a surcharge over and above the base currency exchange rate – and those charges will vary depending on the bank so you should check first. 

For international transactions you’ll need your bank’s Business Identifier Code (BIC) and your unique International Bank Account Number (IBAN), which come with every business bank account. 

Yes, although if you want more than one account you’ll have to apply for each separately. 

Although you can use your personal current account for business transactions if you are a sole trader, it is much better to keep your personal and work finances separate.

You cannot use a personal current account if you are running a limited company as this would not be compliant with the legal expectations of running a limited company.

Having a business bank account will make it much easier when you come to fill in your HMRC tax return, whether it is a self-assessment form because you are self-employed, or you are filing a company report.

It is better not to use your business bank account for personal items. Under HMRC tax rules, some business expenses can be offset again tax when you file your tax return.

By keeping your personal and business finances separate, you will be able to demonstrate that the spending in your business bank account is for work purposes only, and therefore qualifies for tax relief.

It’s possible to open a business account with bad credit but it may be difficult, especially if you’ve been declared bankrupt or had a County Court judgement (CCJ) against you in the last five years. If you're struggling it might be worth speaking to a financial advisor.

Fraud and financial crime are happening more often, with fraudsters and scammer tactics getting more sophisticated by the day. A responsible bank account provider will have the security of your funds as their top priority, however there are also things you should do to protect yourself.

• Make sure you keep your contact details up to date so your bank account provider can reach you if suspicious activity is seen on your account.

• Never share your Online banking username or password with anyone over the phone, by text or email, even if the caller claims to be from your bank or the police.

• Never share the answers to your memorable questions linked to your bank account 

• Never share any unique verification codes or your one time passcode with anyone

• Create passwords that are difficult to guess and don’t use personal information. It pays to use a mix of upper and lowercase letters, numbers and symbols

• Always use different passwords for your online accounts

• If you’re ever contacted by your bank via the phone, SMS or email and you’re not sure it is them, don’t hesitate to stop and call them back on their official customer service phone line to ensure the communication is genuine.

A business bank account is designed specifically for managing business finances, whereas a personal account is intended for individual use. Key differences include:

• Legal compliance: Limited companies are legally required to separate business finances

• Features: Business accounts often provide tools like invoicing, multi-user access, and business loans

• Fees: Business accounts may charge maintenance fees and transaction cost

• Tax and accounting: They help streamline financial reporting and tax filings by keeping business and personal finances separate

Sole traders may still benefit from using a business account for professional transactions.