Setting Up Business Banking Account

Setting up business banking account is one thing that every small business is going to need for a business bank account.

The reason for this is that your business accounts should always be kept separate from your personal accounts for tax reasons, not to mention other legal reasons. The process of setting up business banking account and the need for sutting up business banking account will be discuss in this article.

Many small business owners tend to think that it is perfectly fine to mix the two accounts because they own the business and need to get paid, when in reality nothing is further from the truth. Not to mention the fact that setting up business banking account is very easy so there is no excuse not to do it, and also easy to maintain.

Signing Up for an Account

Step one:

The very first thing that you need to do in setting up business banking account is to go for a bank that has a great reputation.

Something you need to consider when choosing a bank is their location that is how convenient it is for you, and also check the accessibility.

Choosing a business bank account

You must set up a business account if you're starting up as a limited company, partnership or any other key business structure. Sole traders can use their own personal accounts (or via a new business account

  • Don't necessarily choose a business bank account simply because you are a personal banking customer. You may well feel more comfortable with a bank you already know personally, but they may not offer the best deal for your business.
  • Make sure you compare several business bank offers, and compare the costs and charges associated with each one.
  • Naturally, only go for banks that have a strong background - names you will have heard of, or even internet banking brands which are owned and operated by the big players.
  • Bank Charges - a key point to consider is how much it will cost you to have a business bank account. You may have a large number of monthly transactions to process, for example, so ensure you know exactly what charges will be levied on your account before signing up. Many major banks provide "free" banking for set periods to new businesses, so this may also be of interest.
  • Online Business Banking- this is an increasingly important service, and most banks now provide an internet service so you can check the status of your account day or night. At Byte start, and with our previous businesses, this is an essential service. Rather than ringing the bank to check if a payment has been made to your account, you can do this yourself in a fraction of the time.
  • Interest - for obvious reasons, you shouldn't hold out for great returns on your business savings income during the current economic climate, but you can certainly choose a bank which offers either free banking, or zero transaction costs.
  • Small Business Team - go for a bank which has a specialized small business banking unit. The set-up process should be simpler, and dedicated teams will be used to dealing with all types of small business and their specific needs.Some businesses will require regular contact with their bankers, so you should go with a team you feel you can build a good personal relationship with.Always remember that you're not tied in to your new bank account for life - you can switch business accounts later on
  • Step two:

    The next thing that you need to do is to determine what kind of a business bank account you are going to need. Something to keep in mind is that there are numerous business bank accounts available and each one is perfect for certain types of business.

    So before you start with setting up business banking account you are going to need to determine which kind of an account will work the best for your small business.

    Step three:

    In trying to figure out what kind of an account is going to work for your small business you are going to need to keep certain things in mind.

    Some things that you are going to need to keep in mind is what kind of a business you are, how many deposits you will be making in a given week or month, how many checks you will be writing each month, what kind of a balance you normally keep in your accounts and how much money you withdraw each month.

    By knowing the answers to all of these questions you can choose the best plan. 

    Step Four:

    Now that you have figured out which bank you are going to use and what kind of a business bank account you are going to need you are ready to setting up business banking account.

    The first thing that you are going to need to do is to make sure that you have all of the documents that you will need. Once you are sure you got all the required document, setting up business bank account will be much easier.

     

    Step Five:

    The documents that you are going to need in setting up business banking account will depend on what type of business you have, meaning what kind of ownership your small business has.

    But some things that you will need regardless of what kind of ownership you have are a taxpayer ID number and a certified copy of the fictitious name certificate. 

    Step Six:

    If your business name is different from your own you then you will have to put your signature on file with the bank and if you want others to be allowed to sign the checks you must authorize them to do so when signing up for your account which is called list of signatories. Of course changes can be made at a later date to your account in person. You are also going to have to provide the bank with two pieces of identification that are current that include your signature and the other authorized users signatures so that the bank can verify signatures when needed.

    Submit, in addition to the above information, a copy of the IRS Ruling on Tax Exemption, a statement on corporation letterhead indicating the corporation's tax-exempt status, and an employer identification number (EIN) for a nonprofit organization.


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    Small business guide is a site built to assist people in setting up business. I do this as a major hubby. As a prolific writer, How best will it be to have a blog that will be useful to those looking to set up or run their own business.
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