I have a question regarding IVAs, self-employment and bank accounts.
I am on an IVA and hoping to set up soon as a self-employed sole trader. It was all going along quite nicely until I discovered that my very basic bank account (not a current account) cannot be used for this purpose.
As I am on an IVA I obviously can't get a current account from any high street banks that I know of, so I imagine the chances of me getting any kind of business account are virtually zero.
Does anybody know of any banks that might give me an account I can use as a sole trader? All I have at present is a Halifax Easy Cash account, which has direct debit and standing order facilities, but precious little else. Does another bank do a similar account that I could use? I don't want an overdraft or a cheque book even.
I have done a bit of looking around on the web and there are a number of companies who claim they can get busniess accounts for people on IVAs, but they want a lot of money to do it.
Could you not use your personal current account to also service the business? I think you will find it very difficult to open a business account whilst you are in an IVA, however with some careful bookeeping you ought to be able to keep your business and personal finances separate even using the same bank account.
Are you going to trade in your own name, or a trading style - and what sort of business will it be?
Hi
Very difficult to open a business account whilst in an IVA.
Try www.secretariatservices.net they have been able to obtain accounts for forum members
Regards
MelanieGiles wrote:
Could you not use your personal current account to also service the business? I think you will find it very difficult to open a business account whilst you are in an IVA, however with some careful bookeeping you ought to be able to keep your business and personal finances separate even using the same bank account.
Are you going to trade in your own name, or a trading style - and what sort of business will it be?
Unfortunately I can't use my personal account to service the business. I only discovered this today when I read the small print. It clearly states that I must not use the account for any kind of business including being a sole trader.
I find it hard to believe that there is no way around this. There must be people on IVAs who are self-employed as sole traders with a bank account that allows business transactions.
My personal account is with Halifax. I am wondering if another bank might allow me to use a basic cash card account to service a business.
Personally I would try it if you are not going to be processing many transactions. Why should the bank tell you what you can and can't pay in, and who you can and can't pay out of the account.
andydavie wrote:
Hi
Very difficult to open a business account whilst in an IVA.
Try www.secretariatservices.net they have been able to obtain accounts for forum members
Regards
Thanks for the link.
There seem to be a few companies who claim they are able to guarantee customers a business account.
MelanieGiles wrote:
Personally I would try it if you are not going to be processing many transactions. Why should the bank tell you what you can and can't pay in, and who you can and can't pay out of the account.
I have considered using the personal account, but it would be just my luck that I would get caught out, which could really screw things up for me.
The monthly standing order/direct debit for the National Insurance would be a dead giveaway that I was running a business through the account. I'm sure they would become suspicious of me constantly depositing cheques as well.
There are other banks that offer a very similar account to the Halifax one - perhaps one of those won't have the sole trader restraints on it?
Last edited by Mattybaldy on Mon Jan 19, 2009 10:46 pm, edited 1 time in total.
Hi Matty - my husband is a self employed sole trader and we are in the process of our IVA application. When we stopped paying the creditors we changed our bank accounts from NatWest to Coop. We got a basic personal current account with them and I think its called a business direct account for the business. We could have had overdraft facilities with them both but declined. And if we keep our balance in the business account at £1000 or above we do not incur bank charges for the first 18 months. Admittedly this has been set up prior to our IVA being approved (fingers crossed) but if you read on the forum Coop seem to be much more welcoming to the IVA types than other banks. You could give them a go anyway. Good luck!! Fi x
Still gathering info....but hope to be on the right path pronto!!
fifilebonbon wrote:
Hi Matty - my husband is a self employed sole trader and we are in the process of our IVA application. When we stopped paying the creditors we changed our bank accounts from NatWest to Coop. We got a basic personal current account with them and I think its called a business direct account for the business. We could have had overdraft facilities with them both but declined. And if we keep our balance in the business account at £1000 or above we do not incur bank charges for the first 18 months. Admittedly this has been set up prior to our IVA being approved (fingers crossed) but if you read on the forum Coop seem to be much more welcoming to the IVA types than other banks. You could give them a go anyway. Good luck!! Fi x
Thanks, that sounds quite promising. I'll go and take a look at what the Co-op have to offer.
I'm with HSBC - but they are not terrible favourable to people in IVAs. Good advice from Fifi - and definately worth a try as the Co-op do provide very good banking facilities.
Just to let you know that my husband was in the exact same position as you and didn't have the funds to pay for the privilage of having a business account. He used his Halifax cash account for about three months and then just made appointments to see the small business managers of all the high street banks and finally found someone who was prepared to offer him a business account with cheque book and debit card.
I have been told that although the banks don't like you using your peronsal account for business transactions, there is little they can do to stop you.
Just to let you know that my husband was in the exact same position as you and didn't have the funds to pay for the privilage of having a business account. He used his Halifax cash account for about three months and then just made appointments to see the small business managers of all the high street banks and finally found someone who was prepared to offer him a business account with cheque book and debit card.
I have been told that although the banks don't like you using your peronsal account for business transactions, there is little they can do to stop you.
Good luck [:)]
That sounds like pretty good advice.
I have decided to take the risk of using my personal account to service the business and then try and obtain a business account at a later date.
If Halifax should suspect that I am using the personal account for business use and that brings things to a head, I will simply ask them if they can provide me with a business account. Afterall, they will be able to see first hand how successful my business is, which might work in my favour.
