To keep finances clear and trackable it makes sense to open a business bank account from the outset.  It keeps finances separate from personal accounts and makes it much easier to prepare accounts and complete tax returns.

 

If you're a new business startup in the UK looking for high street business banking services, you'll want to compare different options based on several key criteria. Here’s a structured approach to finding the best deal:

​

Bank Account Fees

• Monthly account maintenance fees (some banks offer free banking for a limited period).

• Transaction fees (charges for deposits, withdrawals, or transfers).

• Fees for international payments (if applicable).

 

Transaction Limits & Charges

• Cash deposit and withdrawal limits.

• Free electronic transactions vs. charged transactions.

• Cost of cheque processing (if relevant to your business).

 

Branch Accessibility & Customer Support

• Availability of local branches and business support teams.

• Customer service hours and response times.

• Dedicated business account managers (these are quite rare now).

 

Online & Mobile Banking Features

• Ease of use of online banking and mobile apps.

• Real-time transaction tracking.

• Integration with accounting software like Xero, QuickBooks, or Sage.

 

Overdrafts & Credit Facilities

• Business overdraft availability and interest rates.

• Business loans and credit card options.

• Flexibility and eligibility requirements.

 

Introductory Offers & Incentives

• Free banking periods (e.g., 12-24 months of free banking from some High Street banks).

• Cashback or referral incentives.

• Free business advice or mentoring services.

 

Foreign Transactions & Multi-Currency Accounts

• Foreign currency account options.

• Exchange rates and international transaction fees.

• Suitability for international trade or payments.

 

Reputation & Reviews

• Customer feedback and online reviews.

• Ratings from independent comparison sites (e.g., Trustpilot, Which? Moneysaving Expert).

• Business banking awards or recognitions.

 

Additional Business Support Services

• Invoice financing or factoring services (if applicable to your business).

• Business insurance options.

• Legal and tax advice.

 

Ease of Account Opening

• Speed of account setup.

• Online application vs. in-branch visits required.

• ID and documentation requirements.

 

 

Here are the top five based on a recent comparison (March 2025)

When selecting a high street business bank account for your UK startup, it's essential to consider various factors such as fees, accessibility, digital tools, and customer support. 

 

Below is a shortlist of notable business bank accounts that cater to startups:

 

NatWest Start-up Business Account  

Designed for businesses under 12 months old with a turnover under £1 million, NatWest offers 18 months of free business banking, including waived monthly fees and transaction charges. They provide extensive branch coverage and overdraft options. 

 

HSBC Kinetic Current Account  

Tailored for startups and small businesses, HSBC provides 12 months of free banking, after which a £6.50 monthly fee applies. The account offers mobile and desktop access, branch services, overdraft options, and integration with accounting software like Sage. 

 

Lloyds Business Current Account for Start-ups  

Ideal for new businesses, Lloyds offers 12 months of free banking, including waived monthly fees and transaction charges. They provide UK-based customer support, branch access, and user-friendly online and mobile banking platforms. 

 

Starling Bank Business Account  

A digital-only bank offering free business banking with no monthly fees, unlimited electronic payments, and integration with accounting tools like Xero and QuickBooks. Starling has received high customer satisfaction ratings for its services. 

 

Tide Business Account  

Designed for small businesses and freelancers, Tide offers a free basic account with options to upgrade for additional features. It provides quick account setup, expense tracking, and integration with accounting software. 

​

When choosing a business bank account, assess your startup's specific needs, such as the importance of branch access, digital tools, compatibility with your online accounting package, or cost considerations. It's advisable to review the latest terms and conditions on the respective bank's website or consult with their representatives to ensure the account aligns with your business requirements.

​

​

 

 

Key Steps for a New Startup to Establish Strong Bookkeeping & Financial Controls

 

1. Select the Right Accounting Software  

   • Choose a cloud-based accounting system that suits your business model.

   • Ensure it supports invoicing, expense tracking, and financial reporting.
     ​

2. Set Up a Chart of Accounts  

   • Categorise income and expenses properly to track business performance.  

   • Include categories like sales revenue, operational costs, taxes, and payroll.
     ​

3. Track Income and Expenses from Day One  

   • Keep digital records of all transactions and receipts.  

   • Automate expense tracking using linked bank feeds.
     ​

4. Establish an Invoicing System  

   • Use professional invoice templates.  

   • Choose an accounting package with templates you can personalise

   • Automate invoice generation and set reminders for late payments.
     ​

5. Monitor Cash Flow Regularly 

   • Review financial reports weekly or monthly.  

   • Identify trends and potential cash shortfalls.
     ​

6. Reconcile Bank Statements Monthly  

   • Ensure all transactions match your accounting records.  

   • Identify discrepancies early to avoid fraud or errors
     ​

7. Understand Tax Obligations  

   • Register for VAT if required and understand tax filing deadlines.  

   • Consider hiring an accountant for tax planning.

   • Consider subcontracting a bookkeeper if this is not your strong point
     ​

8. Prepare for Payroll (If Hiring Staff)  

   • Register with HMRC as an employer.  

   • Set up payroll software that deducts taxes and National Insurance.
     ​

9. Plan for Growth and Scaling  

   • Keep financial records updated to secure funding or loans.  

   • Use accounting software that allows easy scalability.

 

 

Top 3 Digital Accounting Applications for UK Startups (As of March 2025)

 

Xero 

Best for: Small businesses needing scalability.  

Features:

• Invoicing

• Bank feeds

• Expense tracking

• Payroll integration

• VAT compliance. 
   

   Pros: User-friendly, cloud-based, integrates with 800+ business apps.  

   Cons: Monthly fee after trial, learning curve for beginners.  

 

QuickBooks Online 

 Best for: Startups needing automation & reporting.  

 Features:

• Automatic bank syncing

• Real-time reporting

• Invoicing

• Payroll.  
   

  Pros: Strong tax features, customizable reports, easy-to-use dashboard. 

  Cons: Can be expensive as your business grows.

 

FreeAgent  

Best for: Freelancers & small startups.  

Features:

• Invoicing

• Expense tracking

• Self-assessment tax returns

• VAT management.  

 

  Pros: Free with certain business bank accounts (e.g., NatWest, RBS, Mettle), tailored for UK tax.  

  Cons: Limited scalability for larger businesses.