How to Choose the Right Business Bank Account in the UK | 5 Best UK Business Banks

A business bank account helps business owners to manage their finance. If you have just recently started a business then you may be thinking of how to choose the right business bank account in the UK.

Also, if you are an existing business owner then you might be wondering if you are getting the best business deal.

Here, in this article, we will discuss 5 of the best business bank accounts in the UK so that you can easily make a comparison and choose from them.

What is a business bank account?

A business bank account is specially designed to manage your business finances. Having a separate business bank account will help you to avoid confusion while you will manage your personal and business account.

If you have a limited company and are registered with companies house in the UK then you need to have a business bank account for keeping your business and personal finances separate. On the other hand, if you are a sole trader then you do not legally require to have a business bank account. But, you can open a separate business bank account because it will be easier to handle your business finances separately.

It will be worth considering that some of the business bank account comes with monthly account management fees and there will be some charge for the transactions in and out of your business. While choosing the best business bank account then you must read the documentary so that you can know what will be the charge for you.

If a business bank account offers you free access then it may have some limit on how much you can spend from the account. So, you need to look for the regulations and charges if you cross the limit.

Best app-only business bank account:

The revolution of app-only banks meant that business banking becomes easily accessible and you are now able to manage your business finance on the go from your smartphone. You can install and set up a business bank account from your smartphone meaning you do not require to wait in the queue at the branch of the bank.

Here, we are going to highlight some of the best business bank accounts in the UK right now. App-only banks can be the best business bank account for freelancers and start-up owners because of low account management fees.

Compare the app-only Best business bank accounts in the UK:

In the below comparison table, we will compare the different business bank accounts and their features.

The best digital business bank accounts in the UK:

#1. Starling Business Bank Account:

Starling Bank is one of the best business banks for sole traders, limited companies, and businesses with multiple directors. You can bank with a Starling business bank account without any monthly account fees and also you can be benefited from fee-free spending while you will be travelling abroad for work.

Starling’s business bank account also helps you to integrate your accounting software such as Xero and QuickBooks.

Starling business bank account pros:

• No monthly fees
• Fee-free spending abroad
• Multi-currency accounts

Starling business bank account cons:

• Business overdraft facility for limited companies and limited liability partnerships only
• 0.7% charge for cash deposits (minimum of £3)
• No interest on positive balances

#2. Monzo Business Bank Account:

Monzo offers two business bank accounts-Monzo Lite and Monzo Pro. Monzo Lite offers its customers free business banking including all of the account features of a Monzo Personal account such as free-fee spending while you will be abroad for work and categorized spending.

Monzo Pro offers you facilities one step ahead with additional features such as integrated accounting software, tax pots, and invoicing. But it comes with an additional cost of £5 per month.

Monzo business bank account pros:

• No monthly account fees with Monzo Lite
• Fee-free spending abroad
• Accountancy tools integration

Monzo business bank account cons:

• No Monzo loans or overdrafts (some access to lending options through the marketplace)
• Some features can only be unlocked with Monzo Pro
• £200 cash withdrawal limit outside EEA 3% fee thereafter

#3. Revolut Business Bank account:

Revolut Bank offers a business bank account that perfectly suits a range of business types from freelancers to more established corporate industries. You can open Revolut’s freelancer accounts in the name of the business owner and you can open Revolut’s company accounts in the registered business name.

Revolut’s free business account offers a wide range of features that comes without cost. But the paid-for accounts offer some additional benefits such as fee-free spending abroad and priority customer support.

Revolut business bank account pros:

• Receive, hold, and send money in up to 30 different currencies
• Provide 24/7 customer support
• Provide a wide range of benefits that suit any business owner (from no monthly fees to £100 per month for corporate accounts)

Revolut business bank account cons:

• No overdrafts or loan
• Unable to deposit cash or cheque
• A fee to transfer money within the UK

#4. Tide business bank account:

Tide Bank offers four types of business bank accounts such as Tide basic, Tide Plus, Tide Pro, and Tide Cashback. Tide Basic offers free business banking for business owners who don’t want to pay a monthly banking fee. Tide’s business bank accounts offer you to spend money abroad fee-free.

Also, you can take advantage of other various features it offers such as customizable invoicing and accounting software integration.

Tide Business bank account pros:

• No monthly fee (for the Tide Basic business bank account)
• Free-fee spending abroad
• 0.5% Cashback with the Tide Cashback business account

Tide business bank account cons:

• £1 fee per cash withdrawal.
• No overdrafts
• 20p fee for transferring money in the UK.

#5. ANNA business bank account:

ANNA business bank account is a great option for 1% cashback on business spending. ANNA offers three business bank account subscriptions to choose from. These include pay-as-you-go, Business, and Big business. The Pay as you go business bank account comes with monthly fees, whereas the business bank accounts need to be paid monthly or annually.

You can spend on your Debit card in any country for free but you have to pay for ATM withdrawals, Cash deposits, local transfers, and international payments. Depending upon the type of business bank account that you choose from, you can be benefited from free transactions up to a set limit.

Anna Business bank account pros:

• 1% cashback on business spending.
• No monthly account fee
• Free card payment in any country (although for foreign currency transactions, there is a 1% foreign transaction fee)

Anna business bank cons:

• Charges for ATM withdrawals (it will depend on your account type)
• Transfer currency conversion fee
• Charges for local transfers (account dependent)

FAQ:

What is the easiest business bank account to open in the UK?

Ans: Starling business bank accounts are designed specifically for sole traders, freelancers, and so on. You need to put only a few minutes to install and open your Starling business bank account on your smartphone.

Can a non-UK resident open a UK business bank account?

Ans: Yes, if you are a non-UK resident even then you can open a UK business bank account in the UK. Opening a UK business bank account is a logical step while setting up a business in new a country.

What are the benefits of opening a business bank account in the UK?

Ans: Some of the benefits of opening a business bank account in the UK are-

• Your business transactions will be kept separate from your transactions.
• These accounts allow you to keep your business’s financial records organized.
• You can receive credit and debit card payments.
• You will be able to perform the transactions using foreign currencies.
• You can easily carry out the salary procedures.

Conclusion:

As a sole trader or a limited company business owner, you may be looking for a digital business bank account that offers 24/7 access at low cost, debit and credit transfer, and much more.

Here, we have put together the 5 best business bank accounts in the UK that will help you to accelerate and strengthen your UK business with the following features such as –Cash flow management and budgeting, integration of accountancy tools, invoicing, affordable and easily accessible overdraft.

So, you can compare these business bank accounts and choose the best one that fits perfectly with your business in the UK.