Are you getting the most from your business bank?

Friday 30 September 2016

Whether you're a sole trader or limited company, your choice of business bank account - and how you interact with it - can have a significant impact on your bottom line. So, it is worth dedicating a little time to ensuring you are making the most of your business bank.

Here are a few simple ways to do so:

 

Use a (separate) personal account if possible

If you're a sole trader, you won't necessarily need to set up a business account. This can be a real advantage, because it means you're likely to benefit from better rates and fewer fees - but that doesn't mean you should rely on your existing personal current account.

It is better to set up a separate personal account specifically for your business. This makes it far easier to keep track of payments and outgoings, not to mention making life simpler if HMRC request to look at your company's taxes. Take the time to find an account that will most benefit your company's finances, rather than automatically opting for your existing current account.

 

Business accounts - know what you want

If you do need a business account, make sure you're clear on what you're looking for before you start to investigate your options. For example, it's common for business accounts to set free transaction limits, after which point you incur a fee for each one. Having a good estimate of how many transactions you're likely to get through will help you select the right account.

 

Shop around for a business account

Once you are clear on what you're looking for, it's time to start shopping around for the most appealing option. What this will be will depend very much on your individual business. The important thing to remember is that it is sometimes possible to negotiate a better deal with your business bank - so, if you find something that almost fits the bill but isn't perfect, be ready to talk to the bank in question and see if anything can be done.

 

Be clear on fees

Whichever account you choose, it's crucial to be clear on its fee structure. Knowing what will incur a cost is the key to avoiding unnecessary charges - and that is a fundamental part of keeping your company's finances healthy.

 

Keep your accounting in order

Similarly, keeping your accounting in good order is an important part of getting the most from your business bank. Not only will this help prevent you incurring charges, but it will also make life easier in terms of keeping track of payments, projecting future finances, auditing your account and settling tax.

 

Specialist accountants like Brookson often work closely with a number of banking partners to provide their customers with access to deals on business banking which are tailored to suit the needs of small businesses.


By Victoria McDonnell

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