You have set up your business, whether you’re a sole trader or have just set up a limited company. You’re ready to launch, but are stumped by the myriad of business bank accounts available? While most personal bank accounts offer retail banking that’s free of charge, many business accounts, especially best business accounts for limited companies, come with a monthly fee and often additional fees on top. So, what’s the cheapest business bank account? Which is the best new business bank account? Which bank offers the best business account for sole traders? Luckily for you, we have sifted through the maze of options available in the UK to bring you the best choices.
All of the banks listed below provide direct feeds to accounting giants Quickbooks and Xero. However, Monzo and traditional personal accounts don’t – though Monzo will be launching a business account soon.
APP: The app isn’t the most stellar; it’s poorly reviewed on Apple. However, Android users seem to find it satisfactory with a 4-star rating. I personally use this, wishing it was more user-friendly, especially for sole traders who need simplicity.
Who is it good for?
This account might be the best business account for sole traders and businesses with a hefty number of transactions. Santander also seamlessly integrates with accounting software like Quickbooks and Xero, ensuring you never send a bank statement to your accountant again.
APP – The app has poor reviews on both Android and Apple, it’s a very basic app and not the best. Users are saying it is full of bugs which hangs and freezes a lot. Much like Santander, it does the job just not as good as what we are used to now.
Who is this for?
HSBC offer an 18 month fee-free period (this is better than the Santander if you are not a current customer of Santander), and will give you 12 months at a fixed price after your free banking period ends (currently, this is £5.50 a month). They also have a ‘Best Tariff Promise’, which ensures you’ll be moved onto a standard tariff that suits your business, when the time comes.
What to watch out for
You’ll still pay charges on certain services and transactions.
This was voted the best Banking award in 2018. This has been rated 4+ on both Android and Apple with users saying it is simple to use and makes banking easy.
Who is this good for?
Those hunting for the best new business bank account might find solace here. Especially if your business’s turnover is promising but still below £1 million. This package has 18 months of free unlimited transaction banking. After that, you revert to their standard tariff, at which point you pay per transaction. You can open the account if you started trading within the last 12 months, and the company’s turnover is less than £1 million.
What to watch out for?
NatWest stipulates that unarranged borrowing, other additional services and “Bankline Charges” aren’t part of the offer.
At the end of the no-fee period, you’ll automatically go onto their standard tariff. For the credit card, you’ll need to apply within six months of opening your business current account. The overdraft carries specific charges, too.
This wins awards for the worst app and that is saying something for business accounts with reviews of less than 2 on Apple and Android. It is very basic and if you want to use the app a lot look elsewhere, Users are saying the app crashes, is unresponsive, and restarts.
Who is this good for?
This also offers 18 months free banking if you’re a start up. The free banking includes paying in & taking out cash, paying in or issuing cheques, plus paying standing orders & direct debits.
What to look out for?
Services like CHAPS transfers will be charged for and that terrible app.
App – Tide’s app is intuitive, reminiscent of Monzo, and caters especially to sole traders and small businesses and reviewed well on both apple and android.
Who is tide for?
This is a great application experience, with no monthly or annual fees. They make their money by charging for cash withdrawals and deposits. Other than that there are absolutely no charges, so if you are not dealing with a great deal of cash then these are great. Especially considering how easy it is to set up.
What to watch out for?
If you deposit or withdraw a lot of cash the fees can sting.
Do I even needs a Business Account?
If you’re a sole trader, sometimes a sole trader bank account might not be necessary. A personal bank account might suffice, especially if you’re not overwhelmed with transactions. However, integrating direct bank feeds and reconciling accounts becomes simpler with a business bank account. While you could initially dodge it, as your business grows, you’ll appreciate having one.
Who would we choose?
I’d personally recommend either Natwest or Santander. Natwest stands out with its top-tier app, and Santander offers 18 months of free banking with no hidden costs.
You may also want to choose paypal as a payment gateway, but this isn’t a bank.
If you want any help with choosing a business bank account or making the most of your business account, contact us by phone or email.