Business Bank Accounts Discussed
“It’s almost a practical rule that an account or a package that offers a higher rate of interest also has higher penalties and fines associated with it. ”
To choose an efficient as well as a monetarily assisting business account has become quite a tricky job these days. It has become mandatory to have accounts for your business.They offer clarity, transparency as well as are in sync with the government rules. If you are a sole trader, you are an exception and don’t need an account but managing all your money yourself is also a very cumbersome job and the least advised.
Mostly businessmen opt for banking packages and look for those that offer the highest interest. But this is a wrong thing to start with. What you should look for are the various kinds of charges that are applicable on such packages.
It’s almost a practical rule that an account or a package that offers a higher rate of interest also has higher penalties and fines associated with it. So, whenever your account gets over drafted, be prepared for shelling out a sizeable amount of money.
Moreover, if you are operating a limited company, it’s mandatory by law to have such package accounts. This is done to have precision during the computation of tax.
So, as an additional feature, you should opt for that type of account that offers you much help in auditing and in other kinds of tax calculation purposes. Moreover, certain banks also help their clients in this regard by offering timely financial advice and assistance.
It is practically seen that at the start of a business only withdrawals and pay-ins are what are basically required. So, a bank account that is not a savings account will serve the purpose very well. It’s only later when profits begin to pour in that you should opt for a savings account.
It’s also sensible to have different accounts in different banks. The recent recession in the economy and the fall of major banks has necessitated this. So, in any untoward case, you will be saved form harm, as all your money will not be subject to the same rules and regulations that govern a particular financial institution.
Furthermore, much paper work is also required before the opening up of an account especially in the case when you are desirous of seeking loans from that bank. You should have a well chalked out business plan for the purpose and also see to it that all your capital is well accounted for.
Author - DeeKay
This article was created by DailyOjo staff. Report Spam/Abuse