Set up your business bank account

If you're operating as a:

• sole trader – you don't have to have a business bank account, but it's a good idea to so
• partnership, company or a trust – you must have a separate bank account for tax purposes.

With a business account, you'll find it easier to:

• track your business expenses and income
• control your business expenses and income
• clearly show your business finances separate from your personal finances
• get the information you need for your accountant or to meet your tax and reporting obligations.

Keeping your private and business transactions recorded separately can save you time and money when it comes to preparing financial documents, activity statements and tax returns.

What you will need to set up a business bank account will vary depending on the bank and your business type. Documents and information you will need to provide may include:

• business name
• primary business address
• Australian Business Number (ABN)
• industry type
• identification for all owners or partners.

If you use a single account for both your personal and business banking, you must clearly identify any personal payments or expenses in your cash book.

Internet banking is now the preferred way to pay invoices. Banks use extensive security measures to protect your funds.

With internet banking you can:

• make payments at any time
• see all your transactions, making it easy to account for your debits and credits
• set up direct debits and automatic payments for regular bills, reducing the risk of errors.