In this text, we’ll cover the fundamentals of managing small business funds, including opening a dedicated checking account and applying for a business bank card.
6 reasons to separate your personal and business funds
- Having a business checking account and a business bank card makes it easier to maintain track of your money flow and work expenses.
- This keeps accounting costs low when filing taxes because your accountant doesn’t should spend time separating your personal and business income and expenses.
- Business bank cards often include helpful tools and services, equivalent to higher credit limits, expense tracking software, and extra cards for workers.
- Business bank cards often include precious rewards and discounts.
- Using a business bank card and paying it off every month will aid you construct a credit history for your small business. credit rating will help when you ever must apply for a business loan or line of credit.
- Having your personal business checking account conveys professionalism and credibility to your customers and suppliers. And when you plan to convert your small business into a company, it should have a separate account.
5 FAQs about business accounts and bank cards
Below are five common questions asked by small business owners.
Can I take advantage of a private bank card for business expenses?
Even when you use a private bank card for business expenses, that is not ideal. Just like business bank accounts, business bank cards can aid you run your small business more efficiently. In addition to keeping your accounts separate, business bank card can provide you with all styles of advantages, like the flexibility to earn rewards, purchase various kinds of insurance, and gain access to precious services. And as your small business grows, separating your funds is nice on your privacy, too.
What are some great benefits of a business account?
Business bank accounts may offer features you aren’t getting with a private account. Some examples include merchant services that assist you to accept payments, access to special bank cards, business overdraft protection, or the flexibility to process payments in Canadian and U.S. dollars. Additionally, having a separate account means that you can construct a credit history for your small business, which is able to come in useful when you ever need a business loan to grow.
What do it’s essential to open a business checking account and bank card?
Opening a business checking account and bank card in Canada is analogous to opening your personal accounts and cards. However, different documents could also be required depending on the structure of your small business and the product you’re applying for. Here is a listing of the documents you have to to collect:
- ID card along with your name, address and date of birth
- Social Security Number (SIN)
- Articles of association, if applicable
- Canada Revenue Agency (CRA) business registration number
- Trade name registration, if applicable
Before applying, make clear along with your financial institution what you wish.
What should I search for in a company bank card?
The best business bank cards in Canada offer access to rewards, travel perks, and business-related perks (that you would be able to use for business or personal use!).
As an example, let’s have a look at the Scotiabank Passport® Visa Infinite Business† Card, a bank card that provides rewards and travel advantages that you would be able to use for your small business.
