Many business owners grapple with the decision of whether to even open a proper business bank account for their business. It is tempting to just make do with your personal account and sift through the transactions and take out the business ones for record keeping.
However having a separate business account will save you time and hassle especially as your business gets bigger. It simplifies the bookkeeping process so you no longer have to look at each transaction and decide whether it is business or personal. If you are hiring a bookkeeper this is invaluable as they know that everything in your business account will need to be taken into account.
When it comes to tax time, and let’s face it a time a lot of people only just start considering doing their accounts, you will already have a statement of all your business transactions just by looking at your bank statement.
A business bank account also looks more professional for your clients and customers, they can see you are taking this business thing seriously. Which is also a good thing for your own mindset, your business is a separate and successful entity.
If you are not currently tracking your incomings and outgoings a separate business bank account will give you this data on a daily basis and at least give you a rough idea of how your business is doing.
So, now you know all the reasons why you should have a business bank account but when you are looking at all the different options what do you need to consider:
- The type of business you run, including services you need and cash flow
- Any transaction fees and account service fees
- Whether purchases and sales are domestic or international
- Interest on deposits and interest-free periods on credit cards
- Online services, such as EFTPOS
Ask the questions when speaking to your bank and financial institution and make sure they understand your needs clearly so they can make the best recommendations for your business. Setting up a new bank account should help you track your finances and record your transactions in a way that benefits you and your business now and in the future.