5 min read
With the Making Tax Digital introduction fast approaching, a complete overhaul of the U.K. tax system will soon be upon us.
Businesses in the U.K. must take steps now to improve the efficiency of completing their end-of-year accounts, help manage their finances, and remain HMRC-MTD-for-ITSA Compliant!
This will be a legal requirement in 2024.
Businesses must now open and trade exclusively through a business bank account, and we recommend either the Monzo sole trader Business account or Starling’s sole trader Business account.
However, we recommend reviewing each bank’s terms and conditions before choosing a business bank provider.
All business banks have slightly different policies and fees, and you need to decide which bank is most suited to your business based on how your business operates.
For example, Monzo limits cash deposits to £1,000 per six months, so if you operate a lot in cash, it may not be the best fit for your business, in which case Barclays might be best.
Online Challenger banks such as Monzo, Starling and Tide offer free sole-trader business accounts.
In contrast, high street banks such as Barclays and HSBC accounts come with monthly maintenance fees, usually between £10 and £15 PCM, which should also be considered before applying.
In our experience, we also found the high street banks took far longer to open an account.
Barclays, for example, still requires an in-person interview and can take up to 6-months to open an account.
On the other hand, Starling’s application is entirely online and can have an account open within 7-days.
Our Business Banking support hub, which offers more guidance on business banking, along with direct links to the application forms for the banks we recommend towards the bottom of the page.
Here’s a brief introduction to business banking and how to best operate a business bank account.
