If you’re wondering, “does a limited company need a business bank account?” the answer is almost definitely a yes.
In fact, if you have a limited company in the UK, you’ll need a business bank account to pay service providers, pay registration fees, and pay local taxes.
But, opening a UK company bank account as a non-resident can be very challenging. So, if you don’t actually live in the UK, you might be looking for banking options.
In this article, we’re going to help you start your search for suitable banks. And we’ll also share important challenges non-resident business owners need to prepare for.
Feel free to use the table of contents to jump ahead to any sections that you find relevant.
Table of Contents:
- Business Banking for a Limited Company
- What Do You Need to Open a Business Bank Account?
- Frequently Asked Questions
- Ready to Open a Bank Account For Your Limited Company?
Business Banking for a Limited Company
As mentioned, a limited company in the UK requires a bank account to simply maintain good standing by paying relevant fees, taxes, and service providers.
But, a business bank account is important for a number of other reasons as well. This includes accessing payment processing solutions, paying suppliers and staff, and of course, receiving payments directly from customers.
Separate Business Bank Account From Personal Accounts
As a shareholder of a limited company, it’s important to have a clear separation between your personal finances and those of your business. This is critical both from an accounting perspective but also from a tax point of view.
Of course, if you have questions about how mixing your personal and business finances could affect your taxes, you should speak with a qualified tax advisor that is familiar with your personal tax situation.
Business Checking Account
In most cases, for most small businesses, a limited company will only require a basic business checking account. In fact, a business checking account will provide the functionality and services that around 90% of businesses require.
On the other hand, certain businesses may require more specialized services, such as letters of credit, financing options, treasury services, merchant services, and more.
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What Do You Need to Open a Business Bank Account?
While opening a business bank account can be very straightforward, adding an international owner or overseas operations into the mix can quickly complicate the process.
In part, this is because UK banks require local supporting documents, which companies that operate overseas often struggle to provide. Additionally, banks typically want to see that the entity has a clear connection to the UK.
Local requirements often include a local address and phone number, and in certain instances, they require a local shareholder or director.
In short, UK banks want to know that UK limited companies have a local presence. Of course, traditional banks aren’t the only option available to limited companies in the UK. However, they tend to be the preferred banking option for owners of companies since they typically offer greater security and flexibility compared to online platforms.
To help our members navigate the challenges of opening accounts for their limited company in the UK, we published the most comprehensive UK non-resident business banking report available anywhere.
This report includes how to overcome address and phone requirements, a list of specific banks that cater to UK limited companies at different revenue thresholds, and specific account opening strategies that business owners can successfully open accounts.
- UK Banking for Non-Resident UK LLPs & UK LTDs
You can get immediate access to this report (and many more) when you join either GlobalBanks IQ or GlobalBanks Insider.
Frequently Asked Questions
Below are two of the most common questions that we receive from people looking to open business bank accounts for UK limited companies. If you have further questions you would like answered, don’t hesitate to get in touch with us directly.
Do I Need a Business Bank Account for My Limited Company?
Yes, it’s important to have a business bank account for a limited company in order to make basic business transactions, receive customer payments, and pay service providers, staff, or suppliers. In most cases, business owners choose to open accounts at traditional, brick-and-mortar banks.
However, it can make sense to pair traditional banks with fintech and digital banking platforms to benefit from low-cost transactions, better FX rates, multi-currency accounts, and more.
Can I Open a Business Bank Account Remotely for My Limited Company?
In certain instances, it is possible to open accounts remotely for your limited company. However, not all banks offer this as an option. Additionally, whether this is an option for your limited company will depend on the industry you operate in, the turnover of your business, your company’s ties to the country (and supporting documents), and how “profitable” the bank believes your business might be as a client.
Ready to Open a Bank Account For Your Limited Company?
If you would like assistance navigating your banking options at home or abroad, we can help.
You can access GlobalBanks IQ, our international banking intelligence platform, in just a few clicks. Unlock our bank database, individual bank profiles, account opening strategies and reports, banker scripts, and more.
But, if you want a 100% personalized account opening service that taps into our team’s expertise and provides direct banker introductions, you can get started with GlobalBanks Insider.
Of course, if you have any questions, please contact us directly.