UK. How to open a business bank account

How to open a business bank account in the United Kingdom?

Written by Ying Dong

Located in Northwestern Europe, formerly called “the empire on which the sun never sets”, the United Kingdom of Great Britain and Northern Ireland, also known as the United Kingdom (UK) or Britain, is comprised of four countries — England, Scotland, Wales, and Northern Ireland. After its historical industrialization and massive global expansion, the UK’s economy steadily grew and formed its first bank, the Bank of England, in 1694. Hundreds of years later, London is still one of the leading financial cities, along with New York and Hong Kong. Other financial-associated industries, such as insurance and ESG, are still thriving in today’s open and business-friendly environment, ready to be invested and traded. However, obtaining a company license does not equal being prepared to operate. Getting a business bank account is another important aspect of preparation. What procedures should you follow to open the account, and what documents are required? Below is a detailed explanation of each part.

A) Banks in the United Kingdom

There are many banks available in the country indeed. Traditionally, central leading banks in the UK include HSBC, Barclays, Lloyds, NatWest, Standard Chartered, Santander, and Nationwide Building Society. They have a long-established history and a well-organized banking system. However, due to the widespread usage of the Internet, many online banks tend to gain the market even if they do not have any physical branches. Namely, they are Monzo, Starling, and Revolut. They offer low service fees and other incentives to attract consumers for convenience. Source

B) Business bank account opening process explained

Step 1. Compare services and fees between different banks. Choose a bank you wish to continue wish.

Hint: It appears that mobile banks and smaller physical banks in size are easier to open accounts with. Service fees do not vary much between different banks. It is worthwhile to think about company turnover requirements for different banks.

Here is a the cost to open account plus annual fees compared Source

Step 2. Check with the eligibility criteria listed.

Some banks ban certain industries or have strict requirements on company activity status or physical presence confined to countries. In in case, check banks offer small startup or sole trader services instead.

Step 3. Submit an application form first.

Many banks offer appointments in person, application on websites, or applications on apps.

Step 4. Provide additional documents required by the bank.

For example, they may include:

- Your operating address confirmation

- A short description of what your business does and where (nature of business)

- How you intend to use your business account

- Proof and verification of your identity

- Which bank Business plan you’ll start with

(Revolut: https://www.revolut.com/business/)

For businesses on a large scale, they may include:

• Your Companies House registration number, if you have one

• Details about your business, including tax information and turnover

• Details for your directors or partners, including their names, dates of birth, addresses and National Insurance numbers

(Barclays: https://www.barclays.co.uk/business-banking/accounts/start-up-business-account/)

Other banks examples:

Santander: https://www.santander.co.uk/business/current-accounts/opening-a-business-banking-current-account

Proof of ID, Proof of Address, Proof of Trading Address

• Business name, start date and proof of your current trading address.

• Please also provide 3 years trading address history (if applicable).

• A detailed description of what your business does.

• Anticipated annual turnover for the next 12 months and number of employees.

• Details of your income from the business and any other income sources you may have.

• If you’re switching from another bank — the last statement including your sort code and account number. We also require annual accounts for established businesses.

• If you are VAT Registered, your VAT Number.

NatWest: https://www.natwest.com/business/bank-accounts/business-bank-account.html#summary

Personal details

• Full name, date and place of birth

• Home addresses (and the date you moved there)

• Contact details

• Personal details for any directors, partners, members or signatories.

Business details

• Trading and any registration addresses

• Business contact details

• Information about your business activity and number of employees

• Any other trading names your business uses

• Details of when your financial year ends

Registration for tax purposes

• Details of any countries you (or your business) are registered in

Year-end accounts

• Details of your business’s or cash flow forecasts

Limited companies only

• Your registered company number

HSBC: https://www.business.hsbc.uk/en-gb/products/switching-business-bank-accounts

Business details:

• full business address, including postcode

• contact details (landline number, mobile number, email address)

• Companies House registration number (for limited companies and partnerships)

• your estimated turnover

Personal details from you, plus any partners or directors:

• full name and date of birth

• telephone number and email address

• current personal address (and previous address if you’ve been there under 3 years)

• account number (if you already bank with us)

• details of your debit/credit cards

Lloyds: https://www.lloydsbank.com/business/business-accounts/startup-small-businesses.html

§ a copy or photograph of your signature

§ A UK driving licence or passport (Proving your identity)

§ the name, date of birth and three-year personal address history (including month and year of moving dates), mobile number and email address for everyone connected to the account.

§ your business name, address, details of your activities and estimated annual turnover

§ For limited company accounts, companies house must be up to date before we can progress an application. Please allow 3 days from the date of Companies House registration before applying online or over the phone.

Starling: https://www.starlingbank.com/business-account/eligibility/

• Signed agreements/contracts

• Proof of membership to an industry body

• Qualifications, registrations or licences

• A decision in principle/solicitor documentation

• Proof of property ownership/land registry documents

• Lease agreement

• Bank statements

TSB: https://www.tsb.co.uk/business/accounts/

Personal:

1. Proof of your home address

2. An ID for verification

3. If it’s a partnership, your partnership agreement and details about each partner

For Your Business:

1. A note of your turnover

2. Description or nature of your business

3. Proof of your business name

4. Evidence of your business address

Step 5. Wait for the bank review and start using your account.

C) Q&A: Does anyone can open a business account in the UK?

Yes, however that is subject to different bank regulations as well.

Generally, a national or permanent resident in the UK is definitely eligible to apply. However, they need to be at least 16 years old or above. More often, you can see the requirement of 18 years old. For international students holding UK visas, they are still eligible to open business accounts, depending on bank requirements. For a foreigner not residing in that country, they may still be considered eligible if they are able to provide identifications and other documentations. It is strongly recommended that you check with bank criteria you wish to open the account from.