Having a dedicated business bank account makes managing your finances much simpler and more professional. While it is not legally required for sole traders, separating your business and personal money keeps your cash flow clear, helps you stay on top of income and expenses, and removes stress at bookkeeping and tax time.

A separate account also shows clients and suppliers that you run a serious and organised business. It sets you up for smooth growth if you ever need a loan, apply for credit, or decide to expand.

Comparing Your Options

When choosing a business bank account, think about what matters most:

• Low fees or free banking

• Easy online and mobile banking

• Integration with your accounting software

• Extras such as invoicing tools, savings sub-accounts, or tax pots

Here is a simple comparison:

We recommend opening a business account with Monzo for its handy Tax Pot feature. You can preset a percentage of your income to be automatically set aside in a separate pot, so when self-assessment time comes around, you’ll have peace of mind knowing your tax money is already taken care of.