As you’ve just started operating your small business, you’re probably having a challenging time sorting out your business finances. It’s tedious and time-consuming to keep track of all the money that goes in and out, particularly if you don’t have an accountant and you’re juggling many hats. If you’re wrestling with this predicament, like so many small business owners are, perhaps it’s time you open a business checking account.
Do You Need a Business Checking Account?
While you’re not required by law to have your own business banking account or a checking account, tabbank.com notes that it could help make your small business appear legitimate for customers and suppliers. Likewise, if you don’t draw a distinct line between your personal and business income sources, you’ll find it extremely hard to account accurately for your cash flow, losses, and revenue.
Also, come tax time, you would have to separate your personal and business expenses so that you could pay accurate taxes and obtain the right tax deductions. Without a separate bank account for your small business, you also have to deal with liability issues, because creditors might attempt to go after your private finances if your business owes them a debt.
Once you’ve decided to open up a separate checking account for your small business, you need to take into account many factors when selecting which type to go with. First off, know that all companies have different concerns and priorities regarding their banking needs. For you to choose the most appropriate account type, you need to consider the fees you could comfortably afford and how your monthly spending looks like.
Other Vital Considerations to Keep in Mind
Would you be depositing enough cash, keeping your balance high so that you do away with the monthly fee for maintenance? Are there any extra charges? Are their set limits on how many transactions you could make in a specific period? You need to ask these kinds of questions moving forward so that you could select a business checking account that’s right for your needs.
Your current bank, the one you have a personal account with, might be an excellent option to consider when shopping around for a business bank account. However, depending on business’ specific needs, you might have to find another bank that specializes in business banking. By looking around at all the options available to you and comparing what they have to offer to your business, you will find the bank that would be perfect for your business’ banking needs.