Compare self-employed bank accounts

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

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Free self employed bank accounts

Tide logo
  • Free company registration
  • Free business account
  • Powerful features
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So whether you are self-employed or doing a side-hustle, it is often recommended to create a separate bank account to manage your finances. A number of providers have created bank accounts that have been designed for those who are self employed.

Compare bank accounts for the self-employed

Data indicated here is updated regularly
Name Product Account fee Bank transfers Accounting integrations Non-Sterling transactions Overdraft Account management Key benefits
Tide
Free
£0.20
Free if both accounts are with Tide
Xero, QuickBooks, FreeAgent, ReckonOne, Kashflow, Sage
Free
App, Online
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
Starling Business Account
Free
Free
Xero, FreeAgent
Free

Min. 18 months trading to apply
App, Online
Add the new Business Toolkit onto your free Starling account, and get the first month free of charge (RRP £7pcm)
Mettle
Free
Free
Free agent, Xero
Unable to make international payments
App
Comes with a suite of free accounting software to integrate with
Amaiz
£9.99 per month
Free in first month
Free Starter plan available
£0.20
FreeAgent, Xero, Sage, Reckon One, Kashflow, QuickBooks
1%
0.5% in Europe, 1% elsewhere
App, Online
Get your first month FREE
HSBC Kinetic

No monthly account fees during early access*
Free
Xero, Quickbooks, Sage

International payments unavailable

Up to £30,000 subject to eligibility and application
App, Online
*No monthly account fees for 18 months, thereafter a monthly charge of £6.50 applies
Cashplus business
Free
£0.20
First 10 payments sent each month FREE
FreeAgent, Xero, Sage, Kashflow, Quickbooks, Clearbooks
2.99%

On invitation
App, Online
ANNA
Free
Free up to a max. balance of £5,000 (or up to £500 paid in per month)
Free
2 free transfers per month and unlimited free transfers to Anna accounts
Coming soon
Free
App
Earn 1% cashback for paying with your ANNA card in selected categories. Enjoy premium benefits free for the first 6 months.
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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 corporation, you’ll have to run your business finances through a business bank account, for tax 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.

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.

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.

The bottom line

For most 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.

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