Opening a business bank account can help to keep your business and personal finances separate. Plus, you might benefit from perks such as cashback and accounting tools. Even better, these accounts won’t charge a monthly or annual fee.
Tide Business Bank Account (Free)
9 ExcellentThe free business bank account from Tide has no monthly fees and can be opened quickly and easily online. The account lets you create, send and track invoices from the Tide app, plus you can connect your accounting software and bank account for easy reporting. You’ll also be able to upload receipts to manage expenses, export your transactions in multiple formats or share with your accountant, and get automated forecasts of incomings and outgoings to help you predict cash flow. It’s also possible to send payment links in seconds for online card transactions as well as set up Apple and Google Pay.
Monzo Business Lite
9.4 Excellent| Account fee | Free |
|---|---|
| Arranged overdraft | |
| Requires credit check |
The Monzo Business Lite Account has no monthly fees and provides all the benefits of a Monzo current account, including instant notifications and fee-free spending abroad. Monzo allows users to categorise spending, create payment links and build tax pots, letting users set aside money for tax bills in a pot. There is an option to upgrade to Monzo Pro Business which costs £9 monthly. Unlike Monzo Lite, Monzo Pro offers integrated accounting, including 6-months access to Xero. Monzo Pro also provides multi-user access, allowing up to 2 other people to access and manage the account.
| Account fee | Free |
|---|---|
| Arranged overdraft | |
| Requires credit check |
Mettle by NatWest Mobile Account
8.7 Great| Account fee | Free |
|---|---|
| Arranged overdraft | |
| Requires credit check |
You can apply for the Mettle business account in minutes and it’s completely free to use. Mettle is part of the NatWest Group and there are lots of great benefits to take advantage of. The account lets you create and send invoices on the go, set up “Regular Pots” so that you can save for things like tax and business expenses, and access “Savings Pots” that pay interest. In addition, you’ll get accounting software FreeAgent included with your account, or you can choose to sync your account with other accounting software like QuickBooks and Xero. You’ll also be able to upload receipts to your transactions and manage bookkeeping tasks with ease.
| Account fee | Free |
|---|---|
| Arranged overdraft | |
| Requires credit check |
Business Current Account
| Account fee | Free |
|---|---|
| Arranged overdraft | Up to £250,000 subject to eligibility and application |
| Requires credit check |
There’s no monthly service fee with this business account from Co-op and there are no fees for digital transactions either. Further benefits of the account include the ability to integrate with accounting software such as Xero or QuickBooks, and access to a free payment request app, Go Get Paid, to help you get paid on time. You'll also get a discount on Zellar to help your business become more sustainable, as well as access to free merchant services software and discounted terminals with Clover. You can bank online, in branch, or over the phone. It’s possible to apply for an arranged overdraft on the account during the application process too.
| Account fee | Free |
|---|---|
| Arranged overdraft | Up to £250,000 subject to eligibility and application |
| Requires credit check |
HSBC Kinetic Current Account
8.5 Great| Account fee | £0 per month. £6.50 per month (Fee waived for 12 months from account opening). |
|---|---|
| Arranged overdraft | |
| Requires credit check |
There's no monthly fee for the HSBC Kinetic business account. You can apply for the account via the app and most accounts are up and running within 48 hours. You’ll also be able to apply for an overdraft of up to £30,000 if you wish, with funds available on the same business day that your credit assessment is successful. The account offers a range of perks, including international payments and access to business insurance. Plus you’ll get access to cashflow and spending insights via the app.
| Account fee | £0 per month. £6.50 per month (Fee waived for 12 months from account opening). |
|---|---|
| Arranged overdraft | |
| Requires credit check |
ANNA Pay As You Go Account
8.7 Great| Account fee | Free |
|---|---|
| Arranged overdraft | |
| Requires credit check |
There’s no monthly fee with this business account from ANNA Money, but you pay for what you use. That means transfers in and out of your account and international payments will incur a fee, but ATM withdrawals are free. You can also now pay into your account at PayPoints but again this incurs a fee. The account could be a good option for businesses that don’t carry out a huge number of everyday banking transactions. You get unlimited free expense cards and you can create and send invoices, manage your expenses, set up payment links and give your accountant real time access to your sales and expenses. You can also earn cashback on your spending.
| Account fee | Free |
|---|---|
| Arranged overdraft | |
| Requires credit check |
A free business bank account is simply one that doesn’t charge a monthly or annual fee, and there are no fees for opening the account either. This can be ideal if your business is new and needs to keep overheads low or if you only need to carry out a few transactions each month. However, the remaining account features depend on the provider, so you’ll need to compare them carefully.
Sole traders and freelancers are not legally obliged to open a business bank account as their business isn’t legally separate from them. But if you’re a limited company, you need to open a business bank account. This is because you’ve registered your business with Companies House, which means it’s a separate entity to you legally and financially.
A number of business bank accounts don’t charge a monthly or annual fee. But some of these might only offer this for a limited time, say, 12 months. Even if your bank account never charges a monthly or annual fee, you might still have to pay for certain banking transactions.
For example, some business bank accounts might allow you to make a certain number of free bank transfers or payments each month but charge a fee if you exceed this limit. Others might let you carry out certain transactions for free, say UK transfers, but will charge a fee for others. And others still might charge for all banking transactions on a pay-as-you-go basis.
The key difference between free and paid-for business accounts is that free accounts don’t charge a monthly or annual fee.
How they differ beyond this depends on the provider. You might find free business accounts don’t offer as many perks as paid-for accounts. For example, you might not benefit from features such as invoicing tools or integrated accounting, or you might not earn cashback on your purchases.
Other free business bank accounts might offer the same features as paid-for options but could charge more for everyday banking transactions or have stricter monthly limits. This could suit smaller businesses that only carry out a handful of business banking transactions each month. But a larger business that carries out high volumes of business transactions will likely be better off with an account that charges a monthly fee but offers unlimited free banking transactions in return.
Many free business bank accounts can be opened online. You’ll usually need to fill in an online form, providing a few personal details and some information about your business. Alternatively, you might be able to open the account through the provider’s app, in a branch (if your provider has one) or over the phone.
You usually need to provide your business’ registered address and contact details, and if you’re a limited company, you’ll need to provide details of your company’s registration at Companies House. You’ll also need to provide proof of address and proof of ID for all company directors.
When comparing business bank accounts, you should think about the features most likely to benefit your business, as well as the features you can do without. Consider the below to help you with this:
Free business bank accounts can be particularly beneficial for small businesses just getting off the ground. However, many free accounts come with other charges or limited benefits, so you’ll need to consider exactly what you want from your business bank account to be sure of choosing the right one for your business.
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