Business bank accounts for contractors in the UK 2022

Depending on how you have set up your contracting business, you will likely need a business account. Here are some tips on how to find the best one.

From a finance and tax point of view, contractors are no different from other types of business, meaning that they can hugely benefit from having their own dedicated current account.

A business account is a great financial tool to get paid, manage expenses, and keep your finances in good working order.

Compare business accounts for contractors in the UK

Table: sorted by promoted deals first
1 - 9 of 120
Name Product Account fee Bank transfers Interest (AER) Accounting integrations Arranged overdraft Account management Key benefits Link
OFFER
Mettle by Natwest
Free
Free
0% AER
FreeAgent, QuickBooks, Xero
App
Comes with a suite of free accounting software to integrate with (conditions apply)
Go to site
View details
Finder Award
EXCLUSIVE
Tide Free
Free
£0.20
Free if both accounts are with Tide
0% AER
Clear Books, FreeAgent, KashFlow, QuickBooks, Reckon One, Sage, Xero
Online & app
FINDER EXCLUSIVE: Get 5 months free transfers when using the code FINDER5FREE. Plus register your limited company for free (usually £12) and open a Tide account in one go: choose 'Register a company' from the Tide homepage menu. T&C's apply.
Go to site
View details
FREE TRIAL
Business Current Account - e-Payments Plan - Start-ups
£8.50 per month
(waived in first 12 months)
Free for EU digital transfers (SEPA)*
0% AER
Multiple providers

Subject to application, financial circumstances and borrowing history.
Branch, online, app & phone
No monthly account fee for 12 months on the Start up business plan, thereafter a monthly charge of £8.50 applies. Other charges apply. *Charges for other bank transfers and card payments apply. Visit here for more information. Free invoice and accounting software, provided by FreshBooks, with your Barclays business account. T&Cs apply.
Go to site
View details
OFFER
Cashplus Business Bank Account
Free
£0.30
Free for first 3 payments sent each month (£0.30 for every transfer thereafter)
0% AER
Clear Books, FreeAgent, KashFlow, QuickBooks, Sage, Xero

By invitation
Online & app
No annual or monthly fee when you apply using the Finder link
Go to site
View details
FREE TRIAL
The Co-operative Bank Business Current Account
£10
(waived in first 30 months)
Free
0% AER
N/A

On application (subject to status, eligibility and The Co-operative Bank's Lending policy)
Branch, online, app & phone
Free everyday business banking for first 30 months. Sole traders or Single Directors only. Apply online. Charges apply for cash and cheque transactions & other special services. Subject to status, eligibility and T&Cs.
Go to site
View details
Countingup Starter Business Account
£3 per month
(waived in first 3 months)
£0.30
0% AER
N/A
Online & app
0.3% cashback on purchases for new and existing customers, available until 31 of May.
Go to site
View details
OFFER
Juni Account - Made for ecommerce
Free
Free
0% AER
Xero
Online
IBAN accounts in EUR, USD and GBP available. New customers get 2% cashback on all their virtual Juni card spend for the first 30 days. Made for ecommerce companies.
Go to site
View details
OFFER
Small Business Account
£12.50 per month
(waived in first 3 months)
From £0.30
0% AER
N/A
Online, app & phone
No monthly account fee for the first three months
Go to site
View details
Kapaga Standard Business Account
Kapaga Standard Business Account
£59.99 per month
0% AER
N/A
Online
Go to site
View details
loading

Compare up to 4 providers

Latest reviews of business accounts for contractors

Barclays - Business Current Account - e-Payments Plan - Start-ups

No monthly account fee for 12 months on the Start up business plan, thereafter a monthly charge of £8.50 applies.
This start-up business account from Barclays offers free banking for the first 12 months, with no fees for standard transactions. After the 12 months are up, you can choose from two Price Plans, designed for the way your business makes and receives payments. The e-Payments Plan will likely be better for contractors as it's suitable for businesses that mainly make and receive payments via electronic payments, online banking and debit cards, and it costs £8.50 a month. The Mixed Payments Plan is suitable if your business uses cash, cheques and electronic payments, and has a monthly fee of £8. Transaction fees apply to both plans. You will also benefit from free invoicing and account software from FreshBooks, and access to a UK-based team of business managers to help you grow your business. You can apply for the account via the app, online or over the phone.
  • 12 months of free banking
  • Multiple ways to bank – online, mobile, telephone or in-branch
  • Dedicated business support team
  • Fees apply after the initial free 12 months
  • For startups only (although Barclays has other accounts available for more established businesses)
  • No interest paid on in-credit balances
Account fee £8.50 per month
(waived in first 12 months)
Bank transfers Free for EU digital transfers (SEPA)*

Accounting integrations Multiple providers
Requires credit check Soft search with no impact on credit score
Overdraft



Subject to application, financial circumstances and borrowing history.

Lloyds Bank - Business Current Account

12 months' fee-free monthly and transactional banking for switcher customers.
This business account from Lloyds is designed for start-up and small businesses that have an annual turnover of less than £3 million. New businesses can enjoy free everyday business banking for the first 12 months, after which a monthly account fee of £7 will apply. Certain transaction fees will also apply after 12 months, such as for cheques and cash payments. Further benefits of the account include dedicated support from the Lloyds UK-based business management team, and access to useful guides and business tools. To be eligible for the account you must be aged 18 or over and a sole trader, partner or company director. It usually takes up to 4 weeks to open your account which can be managed via online banking or via the app. There's the option to apply for a business overdraft and you'll also be able to integrate your account with Business Finance Assistance (for a fee).
  • Free everyday banking for first 12 months
  • Free electronic payments
  • Access to Business Finance Assistance and Lloyds Bank Academy
  • Fees apply after first 12 months
  • No interest paid on credit balances
  • Fee applies to Business Finance Assistance after three months
Account fee £7 per month
Bank transfers Free
Accounting integrations N/A
Requires credit check Soft search with no impact on credit score
Overdraft





Up to £5,000 subject to eligibility and application

Tide - Tide Free

Tide Free

★★★★★

Go to site Read review
FINDER EXCLUSIVE: Get 5 months free transfers when using the code FINDER5FREE.
The Tide business account offers three different pricing plans, with its free option likely to be most suitable for contractors, sole traders and freelancers. As your business grows, you can upgrade your plan at any point, so long as you are happy to pay a monthly fee. All plans enable you to sync your account with accounting software like Quickbooks, Sage, KashFlow and Xero. You'll also be able to automatically categorise transactions, send, pay and track invoices and upload receipts. ATM withdrawals cost £1 each, while other transaction fees will depend on the plan you have chosen. The 2 paid-for plans offer the most benefits, including in-app and phone support, plus a 24/7 legal helpline. It should only take 10 minutes to open your Tide business account and no credit checks will be carried out. Your Tide card should arrive within 2 to 4 working days.
  • 24/7 customer support
  • Categorised spending
  • FCA regulated
  • Quick set-up
  • No monthly fees
  • Easy to manage accounts and track payments within the app
  • Ability to set up direct debits and standing orders
  • Can receive online bank statements
  • No branches - all done via the web
  • Doesn't accept cheque deposits
  • No personal accounts
  • No international
  • Transfers or interest offered
Account fee Free
Bank transfers £0.20

Free if both accounts are with Tide
Accounting integrations Clear Books
FreeAgent
KashFlow
QuickBooks
Reckon One
Sage
Xero
Requires credit check
Overdraft



Cashplus - Cashplus Business Bank Account

Cashplus Business Bank Account

★★★★★

Go to site Read review
No annual or monthly fee when you apply using the Finder link.
This account from Cashplus is a straightforward business account with no monthly or annual fees, making it a great option for contractors. You can sign up for a Cashplus business account in a matter of minutes and once your application is approved, your card should arrive within 3 to 5 working days. Through the account you'll be able to deposit cash or money via bank transfer, use your card online, instore or to withdraw cash, pay bills, suppliers and expenses online, and sort and categorise spending on the go via the app. If you employ staff, you'll also be able to order up to 20 additional cards and track expenses and block certain transactions. The account can also be integrated with accounting software to make managing your finances that bit easier. Any funds you deposit into the account will be protected by the Financial Services Compensation Scheme (FSCS) up to £85,000.
  • Have account up and running in 5 minutes
  • Overdraft option "Cashplus iDraft" once you're eligible
  • Currency cards to use overseas
  • Online services in addition to the mobile app
  • Charge to have your bank card issued
  • Traditional bank still needed for majority of your business finance needs
Account fee Free
Bank transfers £0.30

Free for first 3 payments sent each month (£0.30 for every transfer thereafter)
Accounting integrations Clear Books
FreeAgent
KashFlow
QuickBooks
Sage
Xero
Requires credit check
Overdraft



By invitation

Metro Bank - Business Bank Account

The easiest way to open this business account from Metro Bank is to apply online and your account should be up and running within a matter of minutes. Alternatively, you can apply for the account at your local branch. The account has no monthly fee and offers 30 free UK transactions each month, provided you keep your balance at £6,000 or more for the whole month. If you don't, a £6 monthly fee will apply and each transaction will cost 30p. There are no fees for using your card in Europe and you'll also receive business support from a Local Business Manager. Further benefits include access to smart accounting software, including digital receipt capture and direct bank feeds with Xero, and a year's free access to Enterprise Nation's network of business support. You can also choose to apply for an overdraft with your business account.
  • No monthly fees
  • Easy to open
  • Fee-free card transactions in the UK and abroad
  • Access to accounting software
  • Fees apply to certain transactions
  • No interest paid on balances
  • Interest applies to overdraft
Account fee £6 per month. Fee waived if account balance £6000+
Bank transfers £0.30
Accounting integrations Xero
Requires credit check Soft search with no impact on credit score
Overdraft



Do you need a business bank account as a contractor?

If your business is set up as a limited company, then yes. As your business is a separate legal entity, its finances must not be mixed with your personal ones.

If you are set up as a sole trader instead, technically there is nothing stopping you from using your personal account for professional purposes. However, it’s not advisable because it will make it harder to separate the two things, work out how much you earn exactly, keep track of paid invoices and so on.

Using your personal account for business purposes is also likely to violate your bank’s terms and conditions.

How to open a business account if you are a contractor

Depending on the account provider you choose, you will be able to open the account in person or online.

You will need to provide both your business and your personal details and documents, including:

  • Your business name and address
  • Companies House registration number if you’re a limited company
  • Certificate of incorporation
  • Your own personal details and contact information
  • A form of ID
  • Proof of address
  • Estimated business turnover
  • Personal bank or financial statements

Eligibility criteria and required details and documents can vary from bank to bank.

How to compare business bank accounts for contractors

There is no such thing as dedicated business accounts for contractors, so you’ll have to make do with what the market has to offer to small businesses in general. Some things to consider are:

  • Application process. Setting up a business account can take time with some banks, while others are quicker and easier to deal with. As a contractor, you may not need a super complicated account with lots of features, so it’s worth looking for a more straightforward and sleek option.
  • Costs and fees. Business accounts tend to be more expensive than personal accounts, so always check them carefully.
  • Managing the account. How do you prefer managing your account? Online, in person, over the phone? Some banks will not offer all the options, so it’s worth considering this in advance.
  • App and digital services. These days having a good digital banking service and a slick banking app makes all the difference, especially for a busy contractor who doesn’t want to spend a lot of time dealing with banking administration.
  • Customer service. If anything goes wrong, you want a bank that can help you sort things out quickly and efficiently. Having a look at the bank’s reviews online can’t hurt.
  • Extra features. A lot of business bank accounts include features that can help you manage your business finances, such as overdrafts, invoicing and accounting services, and budgeting features in the banking app.

As a contractor, you might find it useful to have a look at online-only business accounts, especially if you don’t deal with cash and are comfortable with technology.

Online business accounts tend to be quicker to set up and cheaper, and pay particular attention to their mobile banking apps, which tend to work better and have more features.

Pros and cons of a business bank account if you are a contractor

Pros

  • If you own a limited company, you must get a dedicated business account.
  • It makes it easier to manage your business finances and keep track of payments.
  • Some business accounts are relatively easy and quick to set up.
  • You can get extra features to help you with your business finances, from overdrafts to accounting software integration.
  • You can manage most business accounts online or from your phone.

Cons

  • Business accounts usually have more fees compared to personal accounts.

The bottom line

Business bank accounts may sound complicated, but in fact it’s quite easy to get one for a small business, and it will help you organise your finances and manage them easily.

As a contractor, you probably want to look for a straightforward business account without too many frills, that can be accessed online in no time from wherever you are.

Frequently asked questions

We show offers we can track - that's not every product on the market...yet. Unless we've said otherwise, products are in no particular order. The terms "best", "top", "cheap" (and variations of these) aren't ratings, though we always explain what's great about a product when we highlight it. This is subject to our terms of use. When you make major financial decisions, consider getting independent financial advice. Always consider your own circumstances when you compare products so you get what's right for you.

More guides on Finder

Ask an Expert

You are about to post a question on finder.com:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder.com provides guides and information on a range of products and services. Because our content is not financial advice, we suggest talking with a professional before you make any decision.

By submitting your comment or question, you agree to our Privacy and Cookies Policy and Terms of Use.

Questions and responses on finder.com are not provided, paid for or otherwise endorsed by any bank or brand. These banks and brands are not responsible for ensuring that comments are answered or accurate.
Go to site