Business bank accounts for Sole Traders
A guide to applying for business banking
Opening a business bank account for a Sole Trader
Despite not being a legal requirement for a Sole Trader to open a business bank account, most accountants suggest otherwise. The benefits of a Sole Trader having a separate bank account include;
- Keeping personal and business expenses separate, helps to streamline accounting admin.
- Tax returns become easier, with a clear definition between taxable profits/expenses.
- When receiving payments electronically, having a business bank account can seem more professional and reassuring to potential customers.
Comparing business banking for Sole Traders
There are many different options open to Sole Traders, when it comes to business banking, here’s how to find the most suited one for your needs. Think about your business requirements, how do you need to gain access to your account?
Do you need telephone banking, or would you prefer an app? Where will most of your transactions will take place? Do you need to pay in cash regularly? If so where is your nearest branch? Once you’ve established your requirements comparing business bank accounts for Sole Traders becomes straight forward and means you can review accounts on a like for like basis.
Cost and fees for Sole Traders opening business banking
Each bank account will have varying terms and conditions, plus associating costs and fees. When setting up a banking for a Sole Trader you should expect to pay both an administration free and a monthly account service charge. All other transactions carry an individual fee.
When comparing business bank accounts, it’s vital that you think about how you’ll be using it regularly, as this is where most of the monthly costs will lie. For example;
- Will you will be paying in cash on a daily basis?
- will you be using the account to pay for things overseas?
All transactions carry costs, so rather than simply reviewing the upfront costs, try and compare the pricing structure as a whole focusing on the transactions, you’re likely to use most.
APPLY HEREBusiness bank accounts for Sole Traders with adverse credit
Unlike limited companies, Sole Traders credit history is directly linked to both them and the company meaning finding business banking with poor or adverse credit can be difficult. For this reason, if you are searching for a bank account which will accept applications from Sole Traders with adverse credit history, it’s worth considering accounts without credit checks. Before applying though, it’s advisable to have a conversation to establish you fit within that particular banks criteria. They will ask the following;
- When the adverse credit occurred
- The outstanding amount
- Have you repaid the debt?
- Was there a reason for the adverse, i.e. an event such as divorce, recession etc.
Sole Trader declined for business banking
If you have been declined for business banking and require an alternative, Merchant Advice Service can help. Our partnering banks offer no credit check accounts for Sole Traders, which can be agreed within a matter of hours.
APPLY TODAYLibby James
Merchant Services Expert
Libby James Co-founded Merchant Advice Service alongside David Bird in 2016. Her finance background, coupled with retail and customer service experience, gave Libby the drive to bring transparency and non-biased advice to the world of merchant services. Having come from the heavily regulated mortgage and insurance industry, Libby found it puzzling that other financial sectors lacked regulation and transparency leaving customers confused and unable to make informed decisions when it came to accepting card payments. This was soon to become Libby's obsession!
With the help of some of the industry’s best, Libby began to research acquiring banks, complex terminology/regulation, and the problems customers experience within merchant services and payment gateway markets. She spent years on sourcing solutions for complex clients, which previously others were unable to assist with. Libby established relationships with brokers and banks which would soon form the cornerstone of Merchant Advice Service. As a result Libby has been featured in high-profile publications across the web.
Libby is proud to be the entrepreneur’s champion, supporting start-up businesses regularly. Her industry insights can often be found on LinkedIn where she provides free of charge advice and money saving pointers. It’s safe to say she has her finger on the pulse of everything card payments related.
Libby speaks of her experience in founding and running Merchant Advice Service…
‘Merchant Advice Service is one of my greatest achievements to date. We help business owners to overcome card processing issues which can become detrimental to their business. We assist SME’s in finding suitable card payments solutions, helping them create their vision. Each and every day is different, exciting and fore filling. As technology advances I can’t wait to see the way in which the merchant services market advances, and I’m pleased that our business will play a part in educating company owners along the way.’
Read more from this author
Make a quick enquiry
Speak to us directly and get any questions you have answered. Submit your details and we’ll be in touch shortly.