This post will delve into the best business bank accounts for non-UK residents in 2022.
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What is a Business Bank Account?
A “Business Bank Account”, which might also be referred to as a “Business Current Account”, is a bank account used for making transactions, using a debit card, as well as managing an account with the help of online services, etc.
Aren’t those the same services that are offered with a personal current account? Not exactly! Some additional services offered with business bank accounts include invoice creation, payment cards for co-workers, and access to accounting software.
Along with that, there is a primary difference that differentiates normal bank accounts from business bank accounts, i.e., both financial institutions (banks) and HMRC treat the money differently.
This means the money in the general bank accounts is not treated in the same way as the money in business bank accounts when it comes to tax implications.
For instance, imagine that you are a sole trader. This means you and your business are the same, where the income obtained would be treated as normal income and will be taxed on the same basis.
Now, let us imagine you are running a limited company, and that particular company is legally considered a separate entity. In this situation, the income is taxed as the company’s income and will be treated differently for tax purposes.
Tax Scenario
When it comes to taxes, personal income is taxed as per the following rates.
• The basic rate is 20%, which applies to an income below £37,700. Individuals who have a standard personal allowance can exclude taxes for an income of up to £12,570.
For example, if you obtained an income of £30,000 while having the standard personal allowance, then you will be required to pay tax on £18,430 at a 20% rate.
• A higher tax rate of 40% is applicable on the income ranging from £37,701 to £150,000. The standard personal allowance for this tax bracket is £50,270.
• An additional rate of 45% is imposed on the income above £150,000.
You can get access more details on personal income tax by clicking on the link provided below, which is the official website of “GOV.UK”.
Income Tax rates and Personal Allowances
As for the corporate taxes, the main rate ranges from 19% to 25% for the companies having profits of more than £250,000. A small profit rate of 19% will come into effect starting from April 2023.
The small profits rate will be imposed on companies with profits less than £50,000. At the same time, marginal relief will be available for companies with profits ranging up to £250,000.
For more details on corporate taxes in the UK, you click on the link provided below, which is the official website of “GOV.UK”.
Rates and allowances for Corporation Tax
Do you really need a business account?
Every business doesn’t need to have a dedicated business account, yet there are some advantages to having one.
Nonetheless, you will be legally obliged to have a business account while running a limited company while having it registered at Companies House.
You do not need to have a business bank account if you are a sole trader, a freelancer, a contractor, or if you are involved with doing gig work.
However, it would become easy to organize your finances with the help of a business bank account even when you are a sole trader/contractor/freelancer.
Using a business account, you can keep your personal income and business income separate, which makes it easy for you to take care of accounting and filing taxes.
Adding to that, you will be able to build a business credit score which is advantageous for acquiring a business loan or obtaining a company credit card in the future.
Unlike a personal bank account, a business bank account doesn’t have any limitations. This allows you to upgrade your business account while providing you with additional features that help in enhancing your business.
Another major aspect that is to be duly noted is that personal accounts cannot be used for business purposes, and if done so, the account can be closed by the banking provider.
The process of submitting tax returns to HMRC can also be made easier with a business account. You will also get access to business tools, resources, financing, and credit.
Finally, a business account will help your business look more attractive and professional to your clients and customers.
Can you do it as a non-resident?
There are no specific regulations against opening business bank accounts as a non-resident in the UK. Nevertheless, it should also be considered that the majority of the banks only accept applications from company directors who are living in the UK.
Such banks will also ask the applicant to provide a valid proof of address as well.
All this is done because of the anti money laundering regulations in the UK, which are extremely strict. And according to these regulations, accepting clients from abroad is not in compliance.
Because of this reason, you will find it a tad bit hard for finding a banking provider to get a business bank account as a non-resident in the UK.
Don’t worry! In this article, we are going to come up with some of the best banking providers in the UK, through which you can obtain a business bank account without having to go through many hurdles.
You should also remember that opening a business bank account in the UK while owning a business abroad is not a hassle-free process.
Under such a circumstance, you will find it advantageous to have an account with a global bank in your home country and approach their branch located in the UK.
Some of the best global financial institutions for doing this are HSBC, Lloyds, Barclays, and NatWest. These banks generally offer international bank accounts along with specialized business bank accounts in the UK, especially for non-resident customers.
Types of business accounts
Now, let us have a look at some of the types of business accounts available in the UK.
Start-up business bank accounts
As the name itself suggests, these bank accounts are ideal for new or small companies, freelancers, and sole traders.
To support start-up companies with their businesses, some banking providers (who provide these accounts) usually offer a fee-free period (up to a specific period), business support tools, etc.
Business bank accounts for developing or established companies
These business bank accounts are classified based on turnover, and the account holders are subject to certain limits and charges depending on the size of the business.
Business accounts for Communities and Non-Profit Organisations
The bank accounts are dedicated to charities, enterprises, clubs, schools, and other non-profit organisations. The account holders are offered some privileges such as low banking fees (or no banking fees).
You might want to opt for a multi-currency account if you have business operations overseas.
The role of credit history
Even though it might be very difficult for somebody to open a business bank account with a bad credit history, it is not impossible.
Individuals can be arranged a meeting with the bank of their choice, when they have to convey information about the detailed business plan and how they can be an ideal applicant.
Indeed, many banks usually conduct a credit check before accepting applications from individuals, yet it is not necessarily done by all the banks in the UK.
For example, some digital banking providers like Tide, ANNA, etc., only conduct a soft credit check and identity check. This is only done to cope with the anti money laundering regulations in the UK.
Ultimately, when you have a bad credit score, you can either choose the business bank accounts offered by digital banking providers or you can just go ahead with some of the basic bank accounts that come with UK high street banks.
Choosing a banking provider
A few years ago, individuals were only able to obtain a business bank account from either a high street bank or a private bank.
But the situation is changed now, and even when the mainstream options are still a popular choice, the availability of online-only challenger banks and apps has made the process much easier.
As per your needs, considering the information that we’ve covered so far, you can select from various types of accounts such as follows:
• Joint accounts, which can be accessed by the account holders as well as their business partners.
• Accounts without having the necessity of strict credit checks.
• Accounts specifically designed for sole traders.
• Start-up business bank accounts.
• Free business bank accounts.
There is no simple list that provides a list of the type of banks that will or will not accept business accounts from non-residents in the UK. The acceptance of such applications is wholly dependent on factors such as the business, banking provider, and other influential factors.
To make the process a bit easier, we have provided some of the options you can try.
To begin with, there are big UK banks such as Barclays, Lloyds, etc., which in most cases will accept your application, but will require a lot of time as well as paperwork.
Alternatively, some digital providers allow individuals to open a business bank account without too much of a hassle.
Then there is an option of choosing the services from your existing banking provider located in your home country, which has branches within the UK as well.
Finally, you can choose an international business account that comes with an option for multiple currencies, and such banks are deemed to be beneficial for international businesses.
The process of opening a business bank account
Some of the mainstream banks necessitate you to visit their branches in person when you are applying for a business bank account. On the other hand, digital banking providers offer the seamless ability to do everything online.
The basic documentation necessary for opening a business bank account is as follows:
• Business Name
• Address of your business
• Companies House Registration Number (If you are a limited company)
• Personal Details
• Contact Information
• Proof of Identity
• Proof of Address
• Estimated Turnover (Business Income)
• Personal Bank Statements/Personal Financial Statements
While you are opening a business account as a non-resident, some of the documentation may vary. For instance, you might be asked for proof stating that the business has a physical presence in the UK.
For proving the physical presence of your business, you might be asked for the rental agreement of your office or relevant bills.
Can you manage a business bank account from abroad?
Regardless of the option (banking provider) you choose, you will need a robust mobile application as well as exceptional digital/internet banking services.
Telephone banking is optional, yet it can prove to be advantageous when you are trying to resolve issues that can’t be done with the help of an application or internet banking services.
If you are not in the UK, then you can provide signatory powers to your employees over the bank account, which makes it easy for them to deal with the bank in person.
Things to consider
As there are various options to choose from, finding a suitable business account provider can seem somewhat difficult. However, knowing about the banking services you need might make the process much easier, and given below are some important features to search for:
• 24/7 access
• Overdraft facility
• Excellent customer service
• Low banking fees
• Accounting software integration
• The seamlessness of the application process
• Ability to manage the account online
• Access to help at the bank’s branch
• Invoicing tool
• General banking services such as standing orders, direct debits, cheques, etc.
Additionally, it would be profitable for your business if your account has the following features.
• Credit cards
• Interest paid on positive bank balance
• Company expenses cards
Best Business Bank Accounts for Non-Residents in the UK:
Now, let us get to the most-awaited aspect that you’ve all been waiting for till now, i.e., finding out the best business bank account providers in the UK, particularly for non-residents.
You should acknowledge the fact that the options provided below may not be brick-and-mortar banks. We even considered some of the business accounts offered by payment services providers such as Wise, Airwallex, etc.
1. HSBC – Kinetic Current Account
The best feature of this account is the lack of account fees for 12 months, and following that, a monthly charge of £6.50 incurs.
Apart from that, the account can be easily managed, and their mobile application allows some useful features such as tracking your expenses.
This account also comes with an arranged overdraft of up to £5,000 (subject to eligibility); however, interest will be charged for the overdraft amount, which can be a caveat. The account pays no interest on the existing balances, which is yet another disadvantage.
The mobile application allows payments of up to £25,000 per day, and larger payments can be made with the help of their business telephone banking services.
All the necessary information regarding the HSBC Kinetic Current Account and the process to open an account can be accessed using the link given below.
HSBC – Kinetic Current Account
2. Lloyds Bank – Business Current Account
This account is only available for sole traders, partners, and company directors, and the applicants should have an age of 18 years and the annual turnover should not exceed £3 million.
A nice benefit of having this account is the free day-to-day business banking for one year. Along with that, dedicated support services will be offered by Lloyds Bank’s UK-based business management team.
Electronic transactions made with this account are free of charge, and the applicants can also enjoy a three-month trial period of Business Finance Assistance from Lloyds Bank.
However, you should note that banking fees are applicable after the first 12 months and for the Business Finance Assistance service after the trial period ends. The account pays no interest on the existing balances, which is yet another disadvantage.
You can open a business bank account with Lloyds Bank by clicking on the link given below.
Lloyds Bank – Business bank account
3. Tide – Tide Free
A business account can be acquired with Tide even when the individual is not from the UK, and the only requirement is to have a company registered with the Companies House.
Even though there are no credit checks, some additional checks might take place when applying for this business account.
No fees incur while making payments overseas, however, cash withdrawals cost you £1 per transaction.
With the help of their mobile application, you can easily manage accounts or track your expenditures. Simplified account creation process along with the ability to set up direct debits and standing orders.
It is regulated by the Financial Conduct Authority (FCA), yet one of the backdrops is not having physical branches anywhere. Cheque deposits are not accepted, no bank transfers, and there are no personal accounts.
When an applicant applies for this account, they will be offered local GBP account details along with as many as 35 debit cards as necessary by the applicant for their team.
there are no extra currency exchange markup fees with this account, and all other costs are also reasonable.
The disadvantage with this account is the lack of international transfers, but you can opt for Wise for those services.
The account comes with limits, i.e., initial balance limits ranging between £25,000 to £100,000 and debit card limits ranging between £10,000 to £50,000 per month. Regardless of that, you can contact them for raising the limits.
You can either choose a Sole Trader account or a Registered Company account depending on your suitability, and the link to create a business account with Tide has been given below.
4. Monese – Monese Business
The company of the applicant needs to be registered with the Companies House to open a Monese business bank account. The account can be opened from their mobile application easily while having no requirement for a credit check.
This business account is available in 14 different languages and supports transactions in more than 30 countries.
When it comes to features this account comes with some advantageous features such as a savings pot, budget management, etc. One can make deposits easily into this account through post offices and paypoints, but a small deposit fee will be charged.
For this business account, the businesses are required to be registered in the UK and the individual opening this account should possess a Monese personal account.
As most of the banking needs of applicants are not fulfilled with this account, most people still opt for another traditional bank account along with this account.
The account fees are around £9.95 per month and there is no introductory fee-free period.
By the time this article was written, there have been some technical difficulties to open a new Monese Business Account, but they might be available by the time you read these.
You can get to the page for signing up for a new Monese Business account by clicking on the link given below.
5. Wise – Wise Business
Not just in the UK, but Wise allows individuals to have a business account from other countries such as the USA, Australia, Hungary, Singapore, and some other countries.
In the UK, the applicant also gets a local account number as well as a sort code. You can get access to 50+ currencies with this account along with IBANs in the UK.
It is also regulated by the Financial Conduct Authority (FCA) in the UK while being considered an e-money provider.
Some other exceptional features include direct integrations, no fees for wise users, availability of direct debit, and low fees for currency exchange and transfers.
However, a huge drawback is having an online spending limit of only £10,000 per day and £30,000 per month (but the bank transfers are free from such limits).
Even though most people don’t withdraw cash from their business accounts, they might feel a bit inconvenienced when they want to withdraw more than £200.
If you want to open a Wise Business account, then you can get to the process by clicking on the link provided below.
6. Airwallex
Airwallex is an Australian-based fintech company that offers global business banking services just like Wise. Even though it is not as efficient as wise, it can be considered a good alternative.
With Airwallex’s business bank account you will be allowed to make payments in 30 different currencies to more than 130 countries. Along with the GBP global account, Airwallex offers 11 global accounts.
Payments can be made directly with the help of Amazon, eBay, Shopify, PayPal, and WeChat. There are no deposit limits for receiving money into the account, and this account also offers separate cards and logins for employees.
This account can be integrated with the accounting software Xero. You should remember that there is a possibility for extra FX markup fees during the weekends or some other days when the FX markets are closed.
One of the huge drawbacks with Airwallex is not offering physical cards, except for the Australian customers.
You can access the process of applying for an Airwallex Business account by clicking on the link provided below.
7. Revolut – Revolut Business Free
Non-UK residents can open this account when the company is registered and operates from the EEA or Switzerland. The account can be opened within a few minutes and has four pricing plans (including a free account).
Some beneficial features include integration with accounting software, smart invoicing, debit cards for employees, spending limits, tracking expenses, etc.
Sub-accounts can be created in more than 30 currencies (without hidden fees) for receiving, holding, and exchanging money. It is easy to apply for this account and the mobile application comes with a lot of great features.
Bank Transfers are free up to a limit of 100 local transfers (20p after that) and 10 international transfers (£3 after that) per month.
Free transactions are limited for the applicants who choose a free account, and all the transactions incur a charge. No interest. Only the EUR accounts can get access to direct debits.
Finally, the most important thing to consider is that this is not yet a fully-fledged bank.
You can apply for the Revolut Business Account by clicking the link given below.
8. Card One Money
Anyone having an age of at least 18 years and a residential address in the UK is eligible for the Card One Money account.
There are four types of options to choose from, which have been provided below.
• Limited Company
• Sole Trader
• Partnership
• Corporate
For the corporate account, companies need to have an annual turnover of more than £2 million to become eligible.
You can pay money using cash/checks. With this account, IBAN and SWIFT codes are provided for international payments.
There is no monthly fee for the first 3 months, but after that, the customers are required to pay £12.50 per month. We should also remember that there is a £55 one-off application fee.
Other costs are as follows:
Faster Payments – 30p (next day online), £7.50 (same day online)
CHAPS – £30
Direct Debit – 30p
You can learn more about the features offered by the Card One Money business account or instead apply for one by clicking on the link below.
Card One Money – Business Account
9. Acorn Account – Acorn Business Account
Just like the Card One Money business account, anyone having an age of at least 18 years and a residential address in the UK are eligible for the Acorn Account’s business account.
For more information regarding the identification requirements, you can go through the link provided below.
Keeping that aside, it is also a good business account that comes with features such as 24/7 accessibility, efficient customer support, a dedicated account manager, etc.
This account also comes with four types of options to choose from, namely:
• Limited Company
• Sole Trader
• Partnership
• Corporate
For the corporate account, companies need to have an annual turnover of more than £2 million to become eligible.
The customers are required to pay £12.50 per month as a monthly fee. We should also remember that there is a £60 one-off application fee.
Other costs are as follows:
Faster Payments – 30p (next day online), £7.50 (same day online)
CHAPS – £30
Direct Debit – £0
Applicants can pay using cheques or withdraw at Barclays branches, which is an excellent advantage for the customers.
You can pay money using cash/checks. With this account, IBAN and SWIFT codes are provided for international payments.
To apply for the Acorn Account’s business account, you can click on the link provided below:
Acorn Account – Business Accounts
10. Fair Everywhere – Business Account
Applicants can choose from GBP, USD, and EUR wallets depending on their necessities. UK-based accounts are supported from Monday to Saturday, and the banking services can be handled using their free mobile money management app.
Apart from the beneficial features, they additionally offer up to 8% cashback rewards, which is very impressive.
All the fees regarding the Fair Everywhere Business Account have been provided below.
All the other details ranging from opening an account to terms & conditions have been provided on their official website, which can be accessed by clicking on the link provided below.
To apply for Fair Everywhere Business Account, you can click on the link provided below and choose the option (from the 4 options) that suits your needs.
Bottom Line
As a non-resident opening a business bank account in the UK, you need to get familiar with the details, features, terms, etc., regarding the bank before opening an account.
Having said that, we hope you’ve gathered all the necessary information regarding opening a business bank account in the UK as a non-resident with the help of this article.
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