How to Open a Business Bank Account in the UK – A Complete Guide
Starting a new chapter in a different country brings both exciting opportunities and unique challenges. Among the most essential tasks in settling down in UK is opening a bank account. Gaining a clear understanding of the local banking system is crucial, as it lays the foundation for financial stability and smooth day-to-day transactions in your new environment.
This guide is designed to simplify and clarify the process of opening a bank account in the United Kingdom. It offers practical insights into the necessary documentation, step-by-step procedures, and key considerations you may encounter along the way.
A quick look at financial service options with 3E Accounting’s guide to bank account opening in the United Kingdom
The United Kingdom has approximately 344 banks, and its financial arena is regulated by the Financial Conduct Authority (FCA). The central bank is known as the Bank of England and is headed by an appointed Governor. If you have or intend to have a business in the UK, it is necessary to have banking facilities. There are plenty to choose from; hence a guide to bank account opening in the United Kingdom is a handy read.
What Documents Do You Need to Open a Business Account in the UK?
To open a business account in the UK, entrepreneurs must comply with several requirements. The process is more straightforward for sole traders, freelancers, and partnerships. These categories of business need only show:
- Valid identities such as passports or IDs
- Proof of personal and business address – usually in the form of utility bills
Limited companies need to provide all these, as well as:
- Company Registration Number (CRN)
- Company’s VAT registration number (if applicable)
- Business plans or financial projections
- Estimated annual turnover
- Details of directors
- Credit check
Additionally, those from non-EU/EFTA countries may also need to provide additional documentation, such as valid visa details.
Which Financial Institutions Should You Consider while opening a Bank Account in the UK?
The UK’s financial sector is mature and diverse enough to accommodate all business needs. With the advent of digitalisation, the type of banks is something to consider as local institutions compete against multinational or online ones.
British banks are usually among the ‘Big Four’ multinational banks, such as Barclays, HSBC, Lloyds, and NatWest. A new player offering some good products and services is Metrobank. If online or mobile banking suits your business style, consider Starling Bank, Revolut, LeoPay or Monzo.
Entrepreneurs with a global footprint looking for international banks can consider Citibank, Bank of America, Triodos Bank and Santander. Alternative solution banks also provide flexible, easy and cheap international money transfers such as TransferWise, Remitly, CurrencyFair, etc.
What Kind of Bank Accounts Can You Open in the UK?
Banks and financial institutions offer numerous products and services. These constantly evolve and upgrade to stay current and ahead of the competition. As an entrepreneur, you may need a personal and a business account. Speaking to a bank’s customer service for in-depth information is always best. Some of the more conventional types include:
- Basic Account
- Savings Account
- Joint Account
- Current Account
- Digital / Mobile Account
- International / Non-resident account
- Offshore Accounts
Each of these types has its pros and cons and costs ranging from free to monthly charges. Business solution firms such as 3E Accounting can advise you on the best choice based on your business needs.
What Is the Step-by-Step Process to Open a Bank Account in the UK?
Opening a bank account in the UK is a fairly straightforward process, though the exact requirements and procedures may vary slightly depending on the bank you choose. Whether you’re applying online or visiting a branch in person, most banks follow a similar set of steps to open a new account.
Here’s a professional breakdown of the typical process:
- Start the Application:
Begin by either applying online through the bank’s official website or visiting a local branch to fill out an application form. - Provide Personal Information:
You’ll need to supply key personal details, including your full name, date of birth, nationality, and contact information. Some banks may also request information about your income, occupation, and employment status. - Submit Supporting Documents:
During the application, you’ll be asked to provide identification documents. These typically include a valid passport and proof of address. If applying online, you’ll need to upload clear digital photographs of the required documents. - Verify Your Identity:
Many banks require identity verification, which may involve taking and submitting a real-time ‘selfie’ along with your passport to confirm your identity matches the submitted documents. - Complete the Application:
Once all documents are submitted and verification is complete, the bank will process your application. You’ll receive a confirmation email once your account has been successfully opened. - Receive Your Bank Details:
Upon approval, you’ll receive your debit card by post, and your online/mobile banking login credentials will either be mailed or emailed to you, depending on the bank’s communication preference.
Additional Considerations While Opening A Bank Account in UK
An international or non-resident account can be opened from whichever country you are staying in before setting up a business in England. However, it is prudent to check for hidden or extra costs. Similarly, do your due diligence regarding the range of products and services, incentives offered, and international availability.
Some mobile or online bank accounts can be opened by providing scans online. These include a valid mobile phone number, email address, and identification such as a passport and proof of address. Foreign nationals must show similar evidence, with the added requirement of other bank or credit card statements.
Alternatives to banks include building Societies, National Savings, credit unions, and Investment Accounts, amongst others. These all offer similar products and services to banks themselves.
As this guide to bank account opening in the United Kingdom shows, the choices are myriad. To get a clearer picture of how best to proceed, Contact 3E Accounting today. Our friendly team of professionals are ready to assist with all your queries.
