If you’re looking sort out your your business finance then the first step you will have to opt for is opening a business bank account. There are a few things you’ll need to know. The requirements can vary depending on the type of company you have as well as the account you’re looking to open and of course the bank itself.
Below, we explore some of the things you’ll need in order to open a business account.
Types of business bank accounts
First, let’s look at the types of business bank accounts out there, of which there are three.
There’s the business checking account, which you can use for everyday business transactions. Then we have the business savings account which you can use to start saving and building interest. And then, the merchant services account which you can use if your business accepts credit card payments.
What you’ll need to open one
This can depend on where you live, the type of business that you run, and when and where your company was established. Some companies will ask for loads of information when it comes to your business, while others are a little more straightforward. One of the easiest places to open a business account is online.
Here are some of the documents that you’ll require:
Social security number / National Insurance Number
Depending on where you live, you’ll need a social security number or national insurance number to prove your business’s identity. If you’re unsure of your social security number or national insurance number, you can request it from former employers or find it on old payslips.
Most of the time a bank will ask for one or two forms of personal identification to ensure that you’re the person that you say you are as well as establishing your connection with your business.
These can include driver’s licenses, other government-issued identification, or passports. Check which one your specific bank accepts before you waste any time going to the bank. Although these days, many business accounts can be opened online.
Proof of address
Whether you’re opening a personal bank account or a business one, you’ll require proof of address. This is part of the identity checks that come along with having a business account. The proof of address establishes who you are. Often it will need to be a government-issued letter or a utility bill.
Some banks don’t accept online printouts so look into it first as there will be variations across brands.
Consider fraud protection
These days, online fraud is on the rise at a pretty astonishing rate. You need to ensure that your data security protocols are in place so that your business is always protected. If you’re making transactions with stationery including voucher checks, do your research to find the best company for the job.
The pros of opening a business bank account
There are many pros to opening a business bank account. The first one is that a business account is a great way to separate your business transactions from your personal ones. Even if you’re self-employed and your sole employee, you will want to keep these transactions separate and on record as to when it comes to your yearly taxes. Having them in the same account can make things confusing and you’ll need a paper trail to ensure you’re doing your taxes correctly.
Another pro of opening a business bank account is that many banks offer rewards or offers when it comes to interest saving rates that are unique to business bank accounts.
And of course, when it comes to business bank accounts there can be special measures in place when it comes to safeguarding against fraud, which as we mentioned earlier in the article is so important when it comes to protecting your company.