Can a business have a savings account?

Yes. Many Canadian banks and financial institutions offer business savings accounts. These accounts let you earn interest on your spare business cash, helping you set money aside for a rainy day or grow your business.

What is the best business savings account in Canada?

The best savings account for your business depends on how much money you want to deposit and your savings goals. Consider business savings account rates, transaction limits, fees and how you can access your funds to find the right account for your needs.

What is the difference between a personal and business savings account?

Personal savings accounts are designed for personal use, while a business savings account must be opened in your business name. Interest rates vary between personal and business accounts, while business savings accounts often also have higher minimum balance requirements and tiered interest rates.

Do online banks offer business savings accounts?

Yes. Online banks like Tangerine Bank and Manulife Bank both offer business savings accounts. They offer competitive rates and minimal fees, so shop around to compare your account options.

Do I need good credit to apply for a business savings account?

Not necessarily. Usually, your credit score is not required when opening a business savings account. The most important factor is whether you meet the financial institution's stated eligibility requirements for opening a particular business savings account. These requirements may include a minimum business income, a minimum deposit and proof that you own a legitimate, registered business. However, fintech and bank policies can vary, so you need to check with your bank to know for sure whether your credit score is a factor.

Can I use a high-interest business savings account for personal savings?

Although owners of sole proprietorships report their business finances on their personal tax returns, business and personal bank activity must be kept separate. The government of Canada requires sole proprietorships to process cheques using a bank account in their business's name. The Canada Revenue Agency (CRA) is much more likely to flag you and require an audit if you mix up your personal finances with your business finances.

Do I get instant access to funds with my business savings account?

Generally, yes. Whether for personal or business use, savings accounts are very liquid and accessible. However, watch out for limits on the number of times you can withdraw funds from your account in any given month.