Forming your own business or organization can be quite tricky, which is why one of the first things you should do is opening a UK business bank account. Business bank accounts in the UK are accounts that serve the purpose of separating all personal transactions from business transactions. However, setting up a business, in the UK, and opening a bank account isn’t as simple as it may seem. Seed formations, a sustainable organization, is a portal for company formations which exists for the very purpose to guide entrepreneurs, from all over the world who are looking to open their business in the UK, to make their company’s formation as simple as possible.
2.0 Types Of UK Business Bank Accounts
Considering how there are several types of business organizations, it is reasonable to assume that there are different types of business bank accounts. Factors such as the size and nature of the business determine which account is the most suitable for your company. Seed formations evaluate the characteristics of your business and guide you on what type of bank account is suitable for your company. Following is a list of the various types of UK business bank accounts in the UK.
2.1 Business Checking Account
Business checking accounts are basic deposit accounts. Checking accounts allows the account holder to add, withdraw, and transfer funds. Account-holders can also make business payments. However, beyond this point is where the confusion can start. You’ll find yourself asking questions such as should you get for an interest-bearing checking account and which bank has the best services for checking accounts. Should you even open a business checking account? Seed Formations can answer all these questions.
2.2 Business Savings Account
Business savings accounts are accounts where companies deposit funds to let them grow. However, savings accounts allow a limited number of cash withdrawals. Seed Formation guides their clients on whether they should open a savings account as savings accounts are uncommon during the initial stages of the company’s formation. Seed Formations guides its clients on whether the company has accumulated enough funds to open a savings account, without decreasing funds to pay their operating expenses.
2.3 Money Market Account
Money market accounts are quite similar to business savings accounts, though they tend to have a higher rate of APY’s. They also allow for a higher number of limited transactions than savings accounts. However, money market accounts expect their account-holders to secure a higher minimum balance than that of saving accounts. New business owners can find deciding between a savings account and a money market account to be tough. However, by consulting with Seed Formations, clients make an informed decision that works in their favour.
Benefits Of Opening A UK Business Bank Account
Opening a UK business bank account creates clear and organized documentation of your business transactions. Sole owners or partners can even process their or their employees’ salary payments. For those who are looking to establish their business, in the UK, while located in other parts of the world, can carry out their transactions using their currency.
While it’s not legally mandatory, in the UK, for any business to open a business account after their company’s formation, it is the smart move. Business owners don’t have to worry about all the high-stake decisions, as by consulting with Seed Formation, owners can make well-informed decisions for their newly formed company.
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