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Open a Business Bank Account

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:


Traditional Banks

Online providers

Examples

Barclays, HSBC, NatWest, Lloyds

Tide, Starling Bank, Monzo Business

Pros

- In-branch support if you prefer face-to-face service
- Wide range of business products (loans, credit, insurance)
- Well established and trusted

- Quick and easy account setup
- Low or no monthly fees
- User-friendly mobile apps
- Features like expense tracking, tax pots, invoicing tools

Cons

- Often higher monthly fees
- Slower account opening process
- Online banking can feel outdated compared to newer apps

- No in-branch service
- Limited range of lending products compared to high street banks
- Customer service usually online-only

Extra Considerations

- Good option if you want to build a long-term relationship for larger financing
- May require minimum balances or charge transaction fees

- Great for freelancers and small businesses wanting flexibility
- Ideal if you do most of your banking digitally
- Check if they integrate with your preferred accounting software

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.

Next Lessons

Create a Business Email Account

4

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02:30

Set up a free Google email account to keep your business communications professional and organised.

Create a Google Business Profile

5

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02:00

Now that you’ve created your Gmail account, setting up a Google Business Profile becomes quick and seamless.

Claim Your Socials

6

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04:30

Claim your Instagram, TikTok and Facebook business pages and start building your brand.

Brand Your Business

7

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06:00

Build a strong brand to make your business stand out, connect with your ideal clients, and create a professional image.