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Business savings accounts

Generally speaking, business current accounts pay fairly poor rates of interest. If you’re a small business looking for a better return on any cash surplus you’ve got sitting in the bank, a business savings account usually provides a better return. Using the right business savings account can not only help companies manage their money more efficiently, but can bolster reserves or provide contingencies for purchases such as new plant or office equipment. However, high interest business savings accounts are fairly rare things – and rates are generally lower than in the personal savings market.

How to find the best business savings accounts

Finding the best business savings account, sometimes called business deposit accounts or investment accounts, depends on whether you’re a sole trader or limited company. If you’re a sole trader, you can open accounts in your own name and benefit from the best personal savings rates, likely to be higher than business account rates. If you own a limited company, the best business savings rates depend on factors like how much money you can save, and whether you need to be able to access it at short notice.

What to remember when searching for business savings accounts

To earn the best rate of return on your business’s cash, you are usually far better off moving it out of your business current account and finding a business investment account. Your current bank won’t necessarily offer you the best rates on a business savings account, so it pays to shop around.

Remember that a limited company is a separate and distinct legal entity, so even if you own your own business and want to get the best return on the cash in your company, you can’t transfer it into your own name without triggering a tax liability. Looking for the best interest rate on a business savings account is normally your best option.

Compare business savings accounts

For a quick and easy comparison of business savings accounts, along with information on notice periods, interest rates and minimum deposits, use our free service. We compare rates across the savings market to highlight top deals from the UK’s banks and building societies. You can also find out more about other types of accounts such as fixed rate savings and National Savings accounts.

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