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How to apply for a business bank account if you’re a contractor

by Kobus Van den Bergh | Aug 25, 2016
  • Contractors looking to open a business bank account for their limited company should be warned that it will take some time. Due to the UK’s anti-money laundering regulations, opening this type of account often involves a lot of paperwork and face-to-face meetings.

    Authentication and regulations can cause delays

    If you’re hoping to open an account at a UK high street bank, have documents confirming your identity and address readily available. Every bank requires this information as this is the first step in the authentication process.

    The information you submit is checked in line with money laundering regulations and undergoes extensive credit checking and referencing. These processes mean that opening an account with a traditional bank is rarely an instant process.

    If you are pressed for time, you could try one of the newer challenger banks that have an online application and approval process. While timelines could be shorter, there is no guarantee of instant approval.

    What could cause further delays or refusal?

    Applicants with a poor credit history or no trading history might struggle to find a high street bank that will allow them to open a business bank account.

    Having a good credit rating is no guarantee that you will be able to open a business account – regardless of whether you have a personal account with a bank.

    You should be able to substantiate all your personal or business details and ensure that those you have provided are correct. Failure to do either will likely see your application refused immediately.

    How to apply

    You’ll need to complete an application form, either online, over the phone or in person, depending on the bank.

    Business details required

    You’ll need to provide extensive information on your business, which will generally include:

    • Contractor’s contact details
    • Business name and registered address
    • Nature of the business, usually classed as “business services” or “business consultancy”
    • Business’s legal status
    • Business start date
    • Anticipated turnover
    • Any funding requirements
    • Incorporation details and a copy of the limited company’s incorporation certificate

    Some banks may ask for a business plan. While this is rare, it might be worth having one on hand just in case.

    Personal details required

    You’ll need to provide in-depth personal information; it’s best to have this ready when you start applying.

    These details are usually required for all directors and signatories on the account, so if you have a business partner or want to include your civil partner or spouse on the signatory list, be sure to include their details here as well.

    You’ll need to provide the following:

    • Name and home address
    • The date you moved into your current home
    • Previous addresses, particularly if you have been at your current address for less than three years
    • Existing personal bank account details
    • Financial information on borrowings, including overdrafts, mortgages and credit card debts
    • Date, country and city of birth, country of nationality and residence

    Completing the application process

    Once you have submitted all the required information, passed the credit checks and confirmed your identity, the bank should accept your application and open a business bank account in the limited company’s name.

    We can help point you toward the right contacts at the major banks, to help ease you into the process of getting a bank account in place too. If you are considering contracting through a limited company, get in touch: Email us or visit our website.

    We are a professional services company that specialises in cross-border financial and immigration advice and solutions.

    Our teams in the UK, South Africa and Australia can ensure that when you decide to move overseas, invest offshore or expand your business internationally, you’ll do so with the backing of experienced local experts.

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