- A limited company is a separate legal entity, so it should bank separately from its directors
- Expect to provide the company number, director details and ID
- Choose between a digital account and a high-street account based on how you bank
- Agree with your accountant how directors take money out
Does a limited company need its own business bank account?
In practice, yes. A limited company is a separate legal entity, so it should receive income and pay expenses through an account in the company's name rather than a personal one. Mixing the two makes your accounts harder to prepare and can create tax issues around director's loans.
What do you need to open a limited company account?
Providers usually ask for the company registration number, company name and registered address, details of the directors and anyone who owns or controls the business, and ID and proof of address for the people involved. Requirements vary by provider, and some can open an account quickly once the company is registered.
Which account type suits a limited company?
Most limited companies choose between a digital business account, which is quick to open and links to accounting software, and a high-street current account, which suits cash handling and future lending. Think about how you actually bank before comparing fees.
Can directors pay themselves from the company account?
Directors can take money out as salary, dividends or repayment of money they have lent the company, and each is treated differently for tax. Paying yourself informally can create a director's loan, so agree with your accountant how you will be paid.
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