What’s the best online business bank account? (UK)

Running a successful business and keen to make the most of your bank account? Or maybe just starting out and looking for the best business bank account? – no matter where you are in your business journey, we’ve got you covered.

For most businesses, opting for an online business account is a great choice – all the modern providers (who offer the best accounts), are only online, typically via a mobile app.

So, without further ado, here’s the best online business accounts.

Best online business accounts

Best business account for international payments

Best business account for savings

Our criteria for the best online business accounts

There’s a lot of options out there in the UK for business bank accounts – and some really great online business accounts.

We’ve compared all the best and most popular accounts, and with a focus on online accounts – online via a website and mobile app – most high street banks use outdated technology, have limited features and are expensive.

The criteria we’ve used to put together the our list of the best online business accounts is:

• Ease of use
• Range of helpful tools and features
• Fees
• Customer service

All the best options we've listed above are business accounts we recommend to our friends and family (if they’re running a business), and we also use some of them ourselves here at Nuts About Money.

That means you can be confident that whichever account you opt for, you’ll be using one of the best online accounts out there – one that’s great to manage your business finances, save you time, and help grow your business.

Best online business account for sole traders

If you’re a sole trader, which is someone who runs a business under their own name, rather than using a limited company (explained below), you’ll need a business account rather than using your personal account.

It’s not a legal requirement, but it is against the terms and conditions of almost every personal bank account – and it’s not worth the risk of getting your account frozen and losing access to your money to pay both business bills and personal bills.

Business accounts are much better anyway! They’ve got some amazing features to help you manage your business finances, and grow your business (such as invoicing), and they can be free (no monthly fees).

The best sole trader business account is Revolut¹, it’s online, and is packed full of features to help your business, accept payments from anywhere (in store, in-person, or online), and save time on admin – best of all, there’s a free plan.

Sole trader vs limited company

If you’re not quite sure what the difference is between a sole trader and a limited company, don’t worry, let’s run through it quickly.

Sole trader

A sole trader is someone who runs a business under their own name – anyone can do this, and you simply start your business! No need to register anything. 

You are technically self-employed, and all the money the business makes in profit counts as your income, which you would pay Income Tax on (the same as if you were employed).

Note: you don’t legally need to open a business bank account if you’re a sole trader, however using your personal bank account for your business would be against the terms and conditions of almost all banks.

Limited company

A limited company is registering the business with the Government (via Companies House) as a separate business, it becomes completely separate from its owners (legally and financially), it is its own ‘legal entity’. 

This means the profits and debts (if there are any) are all the company’s, rather than the owners (the owners have ‘limited liability’, and can’t normally be chased for any debt if there is any).

The owners are called shareholders as they will own a ‘share’ of the company. If a company has 1 share, the person who owns it, owns 100% of the company. If a company has 100 shares, and someone owns 20 shares, they own 20% of the company.

The company can pay out its profits to shareholders as ‘dividends’, which can be taxed slightly less than income Tax.

Note: legally, you need a business account for your limited company – you can’t use your personal account. This is because your business is its own legal entity, and needs an account in its own name.

What’s the best business account for small businesses?

If you’re a small business (so likely a limited company rather than a sole trader), you’ll probably want to make use of the great features that business accounts can come with – such as invoicing, expense management, multiple cards and payroll features – to name just a few!

The account with pretty much every feature you’d ever need as a small business is Revolut¹ – and it works great online and via a mobile app. Plus, there’s a free monthly plan if you don’t need all the features right away.

Nuts About Money tip: if you’re keen to learn more about banking and small business, here’s our guide to the best business account for small businesses, and if you’re running a startup, here’s our guide to the best business account for startups.

What’s the best free business account?

If you’re not keen on splashing out on an all singing, all dancing business account just yet, then don’t worry, you’ve got a wide range of options – and in fact, all of our recommended options have a free plan.

If you’re happy with a great account that just offers the basics, we recommend Tide¹, you’ll get a free account and just pay 20p for transactions (bank transfers).

Or, if you think you’ll want a few more features, such as international payments, or spending on a card abroad, check out Revolut¹, they’ve got a great free plan (no monthly fees), and you can upgrade to more features later down the line if you want to.

What’s the best business account for foreign currency transactions?

If you’ve got international customers or suppliers, and are sending and receiving money in a foreign currency, you’ll likely want to get yourself a nice modern online business account, rather than using an account with a high street bank – they’ll typically charge you hefty fees every time you send or receive cash (and include hiddens fees).

With a modern online account, such as Wise Business¹, you’ll be able to hold, send and receive a huge range of currencies, and send and receive quickly across the world, but not only that, it’s one of the lowest cost options out there – and works seamlessly online and as an app on your phone.

What’s the best business account for business savings?

As your business grows, you might find yourself having lots of spare cash lying around, that you might need at some point but don’t want to withdraw (take out) just yet – well, you can actually earn interest (money) on your money in your business account. Just like a savings account for your own money.

It’s very unusual for a business account to pay interest, but with Wise Business¹, you can earn a top interest rate on all the cash in your account, and you can even let experts invest it for you. It’s easy to use and get set up too.

Nuts About Money tip: you don’t have to just have one business account, you can have as many as you like – so you could have one account for all your regular transactions, and an account such as Wise Business¹ for foreign currency transactions and business savings. 

What’s a business account?

A business account is like a bank account you’ve probably got for your own money, to pay bills and send and receive money. 

However, with a business account, alongside all the regular things you’d expect with your personal account such as online banking, ATM withdrawals, and direct debits (regular payments), there can also be tonnes of extra features to help you manage your business finances – saving you time, and could help grow your business. Let’s run through them now.

Benefits of a business account

• Separate business finances and personal finances
• Accept payments directly from customers (online, in-store or in-person)
• Great features such as invoicing
• Can help with tax admin
• Can help with business loans
• Integrate with accounting software
• Send and receive money internationally
• Earn interest on your business money
• Your bank will be happy (they won’t if you use your personal account)
• They can be free

Let’s run through a few of those now.

Tools to manage your business finances

Online business accounts have some great features to help you manage your finances. If you’ve got other businesses as customers, you’ll likely need to send them an invoice to get paid – a good business account like Revolut¹ can do this all for you, including producing and sending the invoice, and all automatically if it’s a regular payment.

If you’ve got a team, you could also let some team members have a card to spend, and manage all your team’s expenses in one place (you can even set limits and have restrictions on purchases and approval requests).

Plus, you can also manage all the payroll admin (paying employees) through your business account too. The list goes on.

Accept payments

Depending on your business, you might want to receive payments directly from your customers, such as if you were a self-employed plumber, or personal trainer – you could create a payment link with all the payment information pre-filled, and send this to your customer to pay you directly via SMS and email.

You can even create a QR code for customers to scan and send payment directly, for instance, if you’re at an event.

Or, integrate the payment system into your website if you’re selling online.

You’ll likely save cash on fees too – there’s typically high fees when accepting payments via credit and debit cards, and other payment methods.

Integrating with accounting software

A business account can also integrate with accounting software – which can be very useful. Accounting software can produce all the reports that you need for your business, such as a profit and loss statement (how much money your business has made), and a balance sheet (how financially healthy your business is – it shows your assets (things your company owns), and your debts). Plus, loads more reports.

You’ll typically need to file these financial statements (with the Government) at the end of the financial year, and pay any tax owed.

When linking a business account to accounting software, your transactions (sales and expenses) will pull through, and all of the reports you need can be produced automatically. Pretty great right?

Do I need a business bank account?

To put simply, yes you will need a business account. If you’re a limited company, you’ll be legally required to use one, as a business is its own legal entity, and therefore needs its own account to manage its own finances.

If you’re a sole trader, it’s not a legal requirement, but using a personal account for business purposes is against the terms and conditions of pretty much every bank out there. It won’t be pleasant if you end up getting your account frozen and not able to access your money, or pay suppliers and receive cash from customers.

Plus, a business account is far better! And they can be free (no monthly fees). We’ve gone through all the great benefits above.

If you’re keen to learn more about this, check out our guides: do I need a business bank account? And do I need a business account as a sole trader?

Can I still pay in cash with an online account?

Yep. Online bank accounts don’t have any high street branches, but that doesn’t mean you can’t pay in cash, or withdraw cash from a cash machine (ATM) – although unfortunately, not with every business account. And, it’s not typically free (normally a small fee per deposit).

You can typically pay in cash anywhere there’s a PayPoint machine, or simply pay cash in at the Post Office. 

If you do want to pay in cash, check out Tide¹. It’s a great business bank account, with a free plan (no monthly fees).

Note: you’ll still need your bank card to pay money in.

Are online business bank accounts safe?

Yes, online business accounts are perfectly safe to use.

All business accounts need to be authorised by the Financial Conduct Authority (FCA). They’re the people who make sure financial companies are looking after your money.

That also means your money is protected by the Financial Services Compensation Scheme (FSCS), which gives you protection up to £85,000 should the business account provider go out of business.

And typically, your money is stored with a separate, large bank, with all the money under your name, and can only be returned to your business. Giving you that extra reassurance.

Let’s recap

There we go, the best online business accounts. There’s quite a few options isn’t there? But each one is a great option, and all have low fees (or even free).

Online business accounts can let you manage your business money much easier, and on-the-go with a mobile app. They’ve got great features such as invoicing, expense and team management, integrating with accounting software, and you can send and receive foreign currencies easily and for a low cost. You can even save your business cash and earn interest.

To recap, our top recommendation is Revolut¹. They've got a great online business account, which is free (no monthly fees), and is packed full of features.

For foreign currency transactions, we recommend Wise Business¹, there’s a huge range of currencies, it’s easy to use, and very low cost.

And we also recommend Wise Business¹ for saving cash too – you’ll earn a great interest rate, and can even let experts invest to grow your money sensibly over time too.

That’s it. All the best running and growing your business!