How can I open a business bank account in the UK?

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When you are running a company in the UK you are not legally required to have a particular business bank account. You'll find it quickly is important to keep clean accounts though. Thankfully there are plenty of banking choices and the procedure is relatively straightforward.

Here's how to open a bank account for business in the UK.

What forms of corporate organizations operating in the UK?

The business bank accounts which are available to you will rely to some degree on your company's structure and scale.

Legally approved UK corporate bodies are as follows:

  • Exclusive dealer
  • Enterprise Limited
  • Enterprise collaboration

There are also specifically crafted regulatory frameworks for charitable and social enterprises.

It is worth remembering that the precise details of the company systems differ across the different UK nations. For England, for example, corporate relationship liabilities are divided slightly compared with Scotland.

If you are registering a company in the UK, make sure that you are aware of the law in the area in which you work.

May I open a commercial bank account with a foreign corporate company in the UK?

This is very hard for a foreign business company to open a bank account in the UK. If you are already banking in your home country with a large global company, you may find they can help you set up an account with their UK business.

Alternatively, HSBC has a reputation as able to support smaller multinational companies, but it will provide accounts on a case-by-case basis.

May I open an online Business Bank account?

Most high street banks require you to show your ID and identification in person, which makes it difficult to open a full online business bank account. For certain instances, you can start the application online or by phone, but at a later point, you will need to send documents in the division.

Alternative finance options, such as business account Cashplus, are available online, however. Cashplus specializes in prepaid credit cards but also has a product that looks like a business bank account that can be set up entirely on the internet. However, read the small print carefully-you will find the choices here more restrictive than other commercial banking items on the market.

Which bank should I pick?

The UK has immense retail and commercial banking market, dominated by the 'Big Four':

  • HSBC Inc.
  • Sweatshirts
  • Lloyds Community Banking
  • Royal Bank of Scotland Corporation (RBS)

Every bank may have available slightly different products so carefully read the terms and conditions.

HSBC Inc.

HSBC is truly a multinational bank, with 4400 offices in more than 7 countries worldwide. In the UK they include limited corporations, associations, sole traders and charities with business accounts. Account fees for new customers are £5.50 a month but are suspended for up to 18 months.

Barclays has an account for you, no matter what size company you run. They deal with limited companies, partnerships and sole traders and you'll probably find one close by with 1444 branches in the UK. Payment fees are £6 a month but under circumstances, start-ups are able to use fee-free banking.

Lloyds Community Banking

Lloyds provides limited corporations, associations, sole traders and charities corporate plans of up to £ 1 m annual turnover. The monthly charge for this account is £6.50 but this charge is not applicable to new customers, who get up to 18 months of free banking.

Royal Bank of Scotland Group

RBS has just under 500 branches in the UK, and a worldwide network of national offices. We have bank accounts that support small enterprises, unions, sole traders and charitable organizations. Fees are £6.50 a month but new clients running small companies may be delayed for up to 2 years.

Banking and tariffs

It 's important to read the small print carefully before you open your business bank account in the UK-especially the section on banking fees and charges.

Monthly account management fees and fixed fees for banking transactions are difficult to find. Also if those charges look low, they will build up over time.

Most corporations tend to make foreign money transfers from time to time, for example, paying out overseas-based suppliers. When transferring money or making direct transfers between accounts that use different currencies it is worth paying careful attention to the fees applied.

By making foreign money transfers like this, many banks don't give their customers a decent price. These will also add a high initial 'admin' charge for the transaction processing, as well as substantial transaction fees. Those can be fixed fees or a percentage of the transferred number.

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