Best business bank accounts for the self-employed and sole traders

Discover everything you need to know about opening a business bank account if you're self-employed.

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Matthew Boyle

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It is a good idea to create a separate bank account to manage your finances when you’re self-employed so you can keep your business and personal finances in different places. A number of providers offer bank accounts for those who are self-employed. Here we look at how they work, the pros and cons, and how to pick one.

Reviews of self-employed business accounts

Revolut Pro Account - for freelancers

Revolut Pro Account - for freelancers

Account feeFree
Arranged overdraft
Requires credit check
Go to site Read review
Get a £30 sign-up bonus plus up to 1% cashback with Revolut Pro.

If you're self-employed, Revolut Pro is the account made for you. It's a free account that you can open if you already have a personal account with Revolut and offers a few basic features if you're just starting out. Think freelancers, sole traders and side hustles. You can use it if your business is not registered, but if it is you'll need to apply for a Revolut Business account instead. You're able to earn up to 1% cashback, take sales and manage your freelance finances. It's easy to set up Revolut Pro for free in the app, giving you a separate Pro account and card to use for spending.

Tide Business Bank Account (Free)

Tide Business Bank Account (Free)

8.7 Great
Account feeFree
Arranged overdraft
Requires credit check
Go to site Read review
£200 bonus plus 6-months free accounting when you open a Tide business bank account.

You can choose between three different pricing plans with the Tide business account. This includes a free option which could be suitable for freelancers, sole traders and contractors. You can then upgrade your account at any time as your business grows, but a monthly fee will then apply. All options enable you to sync your account with accounting software like QuickBooks, Sage, KashFlow and Xero, as well as 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. You can hold up to 5 business accounts and get 'read access' for team members, allowing them to view and download transactions. Opening an account can take as little as 10 minutes and no credit checks are carried out. Your Tide card should arrive within 2 to 4 working days.

Zempler Bank Business Extra

Zempler Bank Business Extra

8.7 Great
Minimum opening balance£0
Account fees£9 per month
Interest (AER)0% AER
Read review
No annual or monthly fee when you apply using the Finder link.

The Cashplus business account charges no monthly fee and no fees for UK purchase transactions. Signing up for the account can be completed in a matter of minutes and once your application is approved, your card will arrive in 3 to 5 working days. Once your account is up and running, you can deposit cash via bank transfer or the Post Office, use your card online and instore or to withdraw cash, pay bills and expenses online and categorise spending on the go via the app. You'll also be able to track expenses and block certain transactions, order up to 20 additional cards, download statements for each card in CSV format online, manage cards via a centralised management system, and integrate your account with accounting software.

Do I need a business bank account or can I use my personal one?

If your business is set up as a partnership or a limited company, you’ll have to run your business finances through a business bank account, for tax and legal purposes.

If your business is a sole proprietorship, you are still taxed as an individual, so there’s no obligation for you to open a business bank account.

However, you may still find it useful to separate your business and personal expenses. Learn more about using your personal bank account for your business.

Can you transfer money from a business account to a personal one?

Yes, most business owners will pay themselves a salary – and perhaps an occasional bonus – from their business account into their personal account.

The important thing to do is to record and declare these transactions, for tax and bookkeeping reasons.

In many cases, these payments will be delivered automatically using a payroll software provider, so that they are automatically recorded and the taxes are paid.

If your business is set up as a partnership or a corporation, all one-off payments to your personal account will need to be signed off by your business partners.

What you should know - Making Tax Digital (MTD)

If you're a sole trader with a qualifying income of more than £50,000 a year, you'll need to sign up for Making Tax Digital (MTD) from 6 April 2026. Under the new rules, instead of sending one tax return each year, you'll need to submit quarterly tax updates to HMRC and a year-end final declaration. You'll also be required to use MTD-compatible software to keep digital records and make your submissions. Certain business account providers, like Tide and others, offer free Making Tax Digital software.

The government has introduced MTD in an effort to streamline the tax process, reduce the risk of errors and give businesses a clearer idea of how much tax they will need to pay, giving them longer to prepare and save.

MTD is being rolled out in phases, meaning sole traders with a qualifying income of more than £30,000 will be affected from April 2027 and those with an income of more than £20,000 must sign up from April 2028. We have written a detailed guide if you want to have more information on the topic.

Why is a business bank account useful for sole traders?

Although it is not a legal requirement, there are many advantages to having a business bank account as a sole trader.

How to choose and compare a bank account for a sole trader

As with any financial product, the key to finding the best business bank account is to shop around and compare your options.

As part of your comparison, you’ll need to consider which features are the most important to you. For example, are you willing to pay a monthly fee or would you prefer a free account? Keep in mind that there may still be charges for certain transactions such as transfers and cash withdrawals.

You should also think about whether you might need an overdraft, whether you want your account to link to accounting software such as QuickBooks and Xero, whether you need invoicing support and whether you need to regularly bank overseas.

Don’t forget to also consider how you want to manage your account. Are you happy to bank solely online/via an app or would you like the option of being able to pop into a branch? When you’ve considered these options, you should find it easier to find the right account for you.

What does a sole trader need to apply for a business bank account?

The application process varies between business account providers, but you may need the following:

  • Your business name and address
  • Your own personal details and contact information
  • A form of ID
  • Proof of address
  • Estimated business turnover
  • Personal banking/financial statements

Pros and cons

Pros

  • Business bank accounts allow you to separate your business and personal funds. This makes accounting and bookkeeping far easier.
  • Many accounts include useful incentives and improved rates on international payments.

Cons

  • Business accounts don't tend to have as many incentives as personal bank accounts.
  • Many of the best business bank accounts have monthly account fees and may charge you for making payments.

It’s not essential to open a business account if you’re a sole trader (you’ll have to do it if you’re a limited company), but it is a good idea. It lets you keep your personal and business finances separate, making day-to-day money management easier and it helps when it comes to accounting and tax returns. Keep an eye out for account fees, especially those those which kick in after a year. If you’re not going to use the extras thrown in with a paid-for account, such as accounting software, it’s better to choose a free account and pay for the software separately.”

– Rebecca Goodman, financial journalist

Bottom line

For many types of business, it is compulsory to have a business bank account. Even if this isn’t the case for them, the majority of business owners recognise the advantages of opening one. The key benefit of opening a separate bank account for a sole trader’s business revenue is that this helps with tax calculations and enables the business owner to understand their cashflow situation easily.

Frequently asked questions

Our “Best for” picks highlight top options in specific categories based on our independent evaluation (see our full methodology), while “Promoted” tags indicate sponsored placements. Selected products may not suit everyone. We track selected market offers, which may not cover every product. Products are listed in no particular order unless specified, and inclusion or ordering may be influenced by popularity or commercial agreements. Most comparison table data is provided by Defaqto or sourced directly from providers. Always evaluate your own circumstances and consider independent advice before making major financial decisions.
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Matthew Boyle is a banking and mortgages publisher at Finder. He has a 7-year history of publishing helpful guides to assist consumers in making better decisions. In his spare time, you will find him walking in the Norfolk countryside admiring the local wildlife. See full bio

Matthew's expertise
Matthew has written 210 Finder guides across topics including:
  • Helping first-time buyers apply for a mortgage
  • Comparing bank accounts and highlighting useful features
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