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Best UK business bank account for translators?
Thread poster: Richard Foulkes
Richard Foulkes  Identity Verified
United Kingdom
Local time: 11:37
German to English
+ ...
Dec 8, 2011

I'm looking at incorporating as a limited company next year so I'm currently looking at business accounts. Some of the banks are offering 2 years' free banking but I'm sure that won't include foreign currency transactions.

The topic of banking fees for personal accounts has been frequently discussed but I can't find any previous discussion of business accounts.

Any thoughts appreciated.

I'll update this post as and when I find anything. I can't vouch for any accuracy since this is just what I'm told by bank personnel.


Update:

Natwest:
Free banking for 2 years
Standard euro transfers - £10
Inward transfer fee - £7

Barclays:
Free banking for 1 year
Standard euro transfers - £15
Inward transfer fee - £7


[Edited at 2011-12-08 18:42 GMT]


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XXXphxxx  Identity Verified
United Kingdom
Local time: 11:37
Portuguese to English
+ ...
All I can tell you is who NOT to use Dec 8, 2011

Lloyds. Shocking customer service. This may be difficult to believe but they took 4 years and countless letters and 'phone calls even to log a change of address. They mess up almost anything they're asked to do. The right hand doesn't have a clue what the left hand is doing.
I've heard several people on here sing the praises of First Direct.


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Ty Kendall  Identity Verified
United Kingdom
Local time: 11:37
Hebrew to English
Beware of Barclays Dec 8, 2011

Lisa Simpson wrote:

Lloyds. Shocking customer service. This may be difficult to believe but they took 4 years and countless letters and 'phone calls even to log a change of address. They mess up almost anything they're asked to do. The right hand doesn't have a clue what the left hand is doing.
I've heard several people on here sing the praises of First Direct.


I'm probably very biased but I see it as my life's mission to warn people off Barclays. I also worked for them for nigh on a decade, the level of incompetency I witnessed - I could write a book. For every one thing they did right, they did 10 things wrong.


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Hazel Underwood  Identity Verified
United Kingdom
Local time: 11:37
Member (2005)
German to English
+ ...
Santander Dec 8, 2011

I have my company account with Santander and they have been pretty good.

Unless I'm mistaken I don't seem to get charged bank fees for receiving EU payments.

Would be worth looking at anyway!


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Russell Jones  Identity Verified
United Kingdom
Local time: 11:37
Italian to English
(Black) Horses for courses Dec 8, 2011

Lisa Simpson wrote:

Lloyds. Shocking customer service.


Well, I've been a customer for 37 years and have had hardly any problems.
Not ideal for translators though, as their international transfers are expensive.


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Gillian Searl  Identity Verified
United Kingdom
Local time: 11:37
Member (2004)
German to English
converting to ltd co? Dec 9, 2011

Hi Richard and everybody,
I was just about to put up a question about converting to a limited company when I saw this. I'd love to know why you decided to switch? what it involves? and what the benefits are? Are you sure the lower taxes will outweigh the extra accounting fees and work etc involved? Do you know anyone who has already done it? Thanks a lot.
Gillian


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Richard Foulkes  Identity Verified
United Kingdom
Local time: 11:37
German to English
+ ...
TOPIC STARTER
Ltd Co Dec 9, 2011

Thanks for the feedback so far folks. I'll look into Santander now Hazel - sounds promising.

Gillian: I've thought about this for a little while and recently trawled the forums on the subject because there's a number of threads on it. If you check out the calculator below (takes all of 5 seconds), it will give you an idea of the tax difference between sole trader and Ltd, on certain assumptions presumably.

Forming a limited company is pretty straightforward. The Companies House website provides a list of formation companies who do it for varying fees. Negatives include higher accounting fees (but outweighed by the tax saving) and bank charges (hence the thread).

I'm also looking at VAT registration because I'd quite like to reclaim all the 20% VAT I pay, but I think I'll do another trawl to check out the pros and cons of that.

HTH

www.uktaxcalculators.co.uk/dividend-vs-salary.php

[Edited at 2011-12-09 10:38 GMT]


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Sonia Hill
United Kingdom
Local time: 11:37
Italian to English
Good question Dec 9, 2011

I recently started a thread about forming a limited company, which you have probably seen.

Like you, I spent some time investigating business bank accounts and really struggled to get straightforward answers from the banks about the charges involved. When I spoke to Barclays business banking on the phone, after much deliberation they actually told me they don't charge to receive inward euro transfers, but I'm sure this can't be true and your information seems to confirm my suspicions! The other option is to open a euro account, but again this seems to involve a lot of charges and means that I wouldn't necessarily have access to my money straight away.

From a tax point of view only, it would really make sense for me to form a limited company. However, in view of the extra accountancy fees and the high bank charges I have encountered (I estimate around £700 a year on inward euro transfer fees), I don't think I would really save very much at the moment. This, combined with the extra paperwork, has meant that I am now less enthusiastic about the idea.

I have put it on hold for the moment and have agreed with my accountant to review the situation again in a year's time.

I would be really interested to hear more about bank charges, as this is one of the main obstacles at the moment. From this thread it seems that it may be worth investigating Santander. However, my nearest Santander branch is a 20-minute drive away (at least 40 minutes there and back), so that's not ideal.

P.S. Lisa, I have my personal account with First Direct and would highly recommend them. Unfortunately, they don't do business banking!


[Edited at 2011-12-09 14:41 GMT]


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Charlie Bavington  Identity Verified
Local time: 11:37
French to English
HSBC Dec 9, 2011

I've had a business account for 7 years, not paid a penny in fees or charges ever. That said, it is not over-used, some months there is no activity at all. As I type, I'm not sure whether the deal is that I get a certain number of free txns a month and I've never exceeded it....

I should also point out that all my euro xfers are straight into my personal account. Sometimes, having given precisely the same instructions to the French bank, I pay a fee and sometimes I don't, and in truth it seems arbitrary (I know I am supposed to pay a small charge, in fact, for the instructions I give, I guess sometimes the operator forgets to apply it).

Any bank that actually advertises commission-free euro txns will, of course, be making the money on the exchange rate. They will get you, one way or another


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Michal Glowacki  Identity Verified
Poland
Local time: 12:37
Member (2010)
English to Polish
+ ...
Lloyds Dec 9, 2011

Lloyds. Shocking customer service.


I can't agree here. I've had a Lloyds account for 3 years now and I can't say a bad word about them nor the account as such. Yes, the international transfers are rather pricey, but I hardly ever do them.

As for changing the address - the last 2 times I did that it took me about 10 minutes, which consisted mostly of the time I needed to stand in a queue. Then some simple formalities and done. But then again that was a personal account, maybe with business it's different.

Hope this helps.

Thanks,
Michal


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Sonia Hill
United Kingdom
Local time: 11:37
Italian to English
Euro transfers Dec 9, 2011

Charlie Bavington wrote:

I should also point out that all my euro xfers are straight into my personal account. ...
Any bank that actually advertises commission-free euro txns will, of course, be making the money on the exchange rate. They will get you, one way or another


So, if I have a limited company, does this mean I can ask clients to pay me into my personal account and then transfer the money into my business account myself?
I currently don't get charged for euro transfers with First Direct. I agree you are most likely right about the exchange rate (the bank is obviously making its money somewhere). However, on smaller transfers in particular I am certainly losing nowhere near £7 a time on the exchange rate, so "free" transfers still seem to be the better option.


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Charlie Bavington  Identity Verified
Local time: 11:37
French to English
Which account where? Dec 9, 2011

Sonia Atkinson wrote:

So, if I have a limited company, does this mean I can ask clients to pay me into my personal account and then transfer the money into my business account myself?


If that personal account in the UK, or a foreign one?

I take your point re xfer charges. I tend to accumulate large sums in France and xfer thousands at a time. A centime difference in the exchange rate is a big deal to me; a tenner in charges, somewhat less so. Each to their own, naturally. (Let's face it, if and when the arse drops out of the euro, I could be knackered!)


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Sonia Hill
United Kingdom
Local time: 11:37
Italian to English
UK Dec 9, 2011

Charlie Bavington wrote:

Sonia Atkinson wrote:

So, if I have a limited company, does this mean I can ask clients to pay me into my personal account and then transfer the money into my business account myself?


If that personal account in the UK, or a foreign one?

I take your point re xfer charges. I tend to accumulate large sums in France and xfer thousands at a time. A centime difference in the exchange rate is a big deal to me; a tenner in charges, somewhat less so. Each to their own, naturally. (Let's face it, if and when the arse drops out of the euro, I could be knackered!)


A personal account in the UK. It's with First Direct so there are no charges for receiving transfers in euros, although I also take your point about the exchange rate. If I were receiving thousands each time, then a more favourable exchange rate and a small charge would make sense.
I'm worried about the euro too. That's one of the reasons I've deferred my decision about incorporation, as I just don't know what the situation is going to be like in a year's time!


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Gillian Searl  Identity Verified
United Kingdom
Local time: 11:37
Member (2004)
German to English
HSBC Dec 10, 2011

After a long search:
http://www.business.hsbc.co.uk/1/PA_1_1_S5/content/pdfs/en/international_bus_prices.pdf;jsessionid=0000rmgUoaIH4aSjz0hV9Q9PH7E:12c5hrjc0

International price list - Page 8
Payments from the European Union,
denominated in Euro, received by SEPA = charge is £1.00


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Sonia Hill
United Kingdom
Local time: 11:37
Italian to English
Interesting Dec 10, 2011

Gillian Searl wrote:

After a long search:
http://www.business.hsbc.co.uk/1/PA_1_1_S5/content/pdfs/en/international_bus_prices.pdf;jsessionid=0000rmgUoaIH4aSjz0hV9Q9PH7E:12c5hrjc0

International price list - Page 8
Payments from the European Union,
denominated in Euro, received by SEPA = charge is £1.00


When I phoned up HSBC, they told me the charge was £7. However, I got the impression that the call centre staff struggled to answer my questions, so perhaps this wasn't entirely correct. £1 for SEPA payments is much more affordable. I don't think all the euro transfers I receive are SEPA payments, but I presume I could ask clients to pay this way.


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