Business bank account

A separate account for the business. Legally required for a company, and sensible for anyone.

What it means

A business current account is held in the business's name rather than the owner's.

Why it matters

A limited company is a separate legal person and its money is not yours — mixing them creates a director's loan account problem and makes the accounts far more expensive to prepare.

What it looks like in practice

Open one before trading. Expect identity checks on directors and persons with significant control, which is why the Companies House record needs to be accurate.\n\nA separate savings account for tax money is the single most effective cash discipline available.

What to watch out for

Personal accounts used for business trading. Most personal account terms prohibit it, and banks close accounts for it.

Where to get proper advice

Compare on charges per transaction, cash handling fees and integration with your accounting software.