How to Open a Business Bank Account for a UK Limited Company

Why a limited company must have its own bank account

A limited company is a separate legal entity from its directors. Mixing company money with personal funds creates accounting errors, complicates tax filings, and can expose directors to personal liability if the corporate veil is ever examined. HMRC expects company income and expenditure to be clearly separable, and any commercial lender will ask to see business bank statements before extending credit.

Even if you are the sole director and shareholder, pay yourself a salary or dividends through the company account and keep receipts and invoices linked to company transactions only.

What you need to apply

Banks must carry out Know Your Customer (KYC) and Anti-Money Laundering (AML) checks before opening any business account. Prepare the following before you apply:

• Certificate of Incorporation from Companies House
• Memorandum and Articles of Association
• Registered company address and UTR (once issued by HMRC)
• Photo ID and proof of address for each director and any beneficial owner with more than 25% shareholding
• A brief description of the business — what it does, who its customers are, and expected monthly turnover

Some banks also request a business plan or evidence of existing contracts, particularly if you expect to handle large or international payments.

High-street banks versus digital business accounts

Traditional high-street banks (Barclays, NatWest, HSBC, Lloyds) tend to have more rigorous onboarding processes but often provide dedicated relationship managers, overdraft facilities, and integration with CHAPS and BACS payment rails. Digital-first providers (Tide, Monzo Business, Starling, Zempler) open accounts faster — sometimes within a day — and offer slicker app interfaces with automated bookkeeping feeds, though lending products are more limited.

If you anticipate applying for commercial finance in the next twelve months, check whether your preferred provider's statements are accepted by your likely lenders. Most specialist business lenders require twelve months of bank statements in PDF or Open Banking format.

After the account is open

Set up online banking and ensure all directors who need payment authority are added as signatories. Link the account to your accounting software (Xero, QuickBooks, or FreeAgent are common choices) so transactions reconcile automatically. Register the account details with HMRC for corporation tax and PAYE purposes, and update your VAT registration if applicable.

Keep a note of the sort code and account number in a secure location accessible to your accountant — you will need these details for submitting bank details on grant applications, supplier onboarding forms, and loan drawdown instructions.