Business banking in United Kingdom

How business banking works in United Kingdom

UK business banking is broad, with established high street banks alongside licensed digital banks and electronic money providers. A limited company is registered at Companies House and receives a company registration number, while a sole trader registers with HM Revenue and Customs for Self Assessment once trading income passes 1,000 pounds in a tax year. Providers then run anti money laundering and know your customer checks before opening an account. As of 11 October 2026.

Who can open a business account

A UK registered business can apply, and sole traders can open an account as an individual in business even though they are not legally required to. Owners and directors usually need identification and proof of address, and the provider will ask about the business activity and beneficial owners. Companies with overseas owners can apply, but traditional banks often expect a UK based director or address, while several electronic money providers onboard UK companies with overseas owners online. As of 11 October 2026.

Traditional banks compared with digital banks and providers

Traditional UK banks offer deposit accounts that may be protected by the Financial Services Compensation Scheme up to the applicable limit, with branch access, cash and cheque handling, and lending, though many charge a monthly fee after a free period. Licensed digital banks such as Starling are covered by the same scheme but run mainly through an app. Tide is not a bank, but its current accounts are provided by ClearBank, so eligible deposits are covered by the scheme. Electronic money providers such as Wise Business are not banks, so funds are safeguarded rather than covered by the scheme. They often add multi currency features and fast online onboarding. Weigh the trade offs and verify current terms with each provider.

Requirements and documents

Most providers ask for the following before opening. Exact documents vary by provider. Verify with the provider

• For a limited company, the Companies House registration number and incorporation details, or proof of sole trader status.
• Identification for the owners and directors, and details of beneficial owners for anti money laundering checks.
• Proof of business and personal address and a description of the business activity and expected turnover.

How to open an account

1. Register your business, at Companies House for a limited company or with HM Revenue and Customs for Self Assessment as a sole trader.
2. Choose a provider, comparing a traditional bank, a licensed digital bank, and an electronic money provider, and gather the required documents.
3. Apply, complete the anti money laundering and identity checks, and confirm current fees and terms with the provider before you fund the account.