Whether you are an aspiring business person or someone already in the thick of things, it is safe to say that every business-related thing should be separate from your personal life. This includes things such as contact information, business addresses, and above all financial data such as your bank account.
Not only would it be a mess to sift through and sort, but it would also inevitably lead to confusion, which in turn can affect your analysis of your books and cost you dearly. Fortunately, most countries, including the UK, have providers with the capability to build a virtual address for bank account. Hoxtonmix offers a little guide on how to use virtual offices.
Virtual address basics
The virtual platforms allow smaller merchants and traders with lesser means to have a formal business account. There are a myriad of reasons why having a virtual address for a bank account is beneficial to you as an entrepreneur, which we will look into now.
One advantage of having a virtual address for your bank account or simply any other one separate from your holdings is that expansion to become a limited organization is easier. This is because the authorities in charge of registering such enterprises consider a business address compulsory. For someone starting a business with little capital in the UK, there are few choices that are not expensive. One such example is the virtual address, which is a legitimate business place and is recognized by all governing bodies.
The most impressive thing about virtual offices is that they are often affordable, which makes them perfect for a low-level project. Beyond that, they also:
- allow those renting them to partake in all mail-related activities;
- having one is not only convenient as far as practicality is concerned, but it has an impact on how your business performs;
- having one is equivalent to having a bit of prestige and fame, which is something that possible customers will find attractive.
The available options
If you are looking to have a general business address that is recognized by both the HMRC and Companies House, the only two options are the virtual and physical varieties. Both of them are acceptable when creating a business account, however, they have their own unique properties and contrasts:
- For starters, compared to their virtual counterparts, real addresses are not as difficult to set up. They are easily rented or bought, especially when they are your home address;
- However, they are about as big of a risk as you would expect, particularly when it comes to privacy;
- In addition to that, they are difficult if not impossible to register across the borders;
- The most important issue has to deal with how a home address will be viewed as somewhat lacking when it comes to the business’ legitimacy;
- Other issues that can be faced have to do with insurance and leases, which are subject to change as the possibility of moving continues to exist.
Another option that is often called upon in place of a home address is the use of your local PO Box. As a public place that can both send and receive mail, they would seem ideal as a choice for a small business.
However, the services they provide are notoriously expensive. This is coupled with the fact that they are not a viable option for those seeking to grow into a limited company as per the laws created by Companies House.
How virtual platforms can create a separate bank account
Something that can limit the standard account for personal use is that it can’t be created via a virtual address because of the whole verification process. Business accounts, on the other hand, have no problem with this, and the UK’s regulatory bodies feel the same way.
So long as you use the same virtual address that your business was registered under, there should be no problem.
Building virtual platforms for bank accounts
Using such a platform does vary, because every provider puts their unique spin on things. That said, the basic way in which they work stays the same, as does the way they are built. The following is a quick guide to building virtual addresses for bank accounts:
Step 1: Acquire your virtual address
This is the first step for a reason, which is that the governing bodies that deal with registration will not accept anything that has no business address. As such, it is important to acquire one of any sort – in this case, a virtual address.
Step 2: Figure out the price
The typical provider usually offers some sort of package to help entrepreneurs on a budget. Often there will be options that get better as the price increases. Fortunately, even the cheapest of these options is of good quality, which means you should look for a provider that best suits you.
Step 3: Applying for an account
With your address registered, you can finally begin the process of applying for the bank account, in which your operation’s address is the most important part. Other documents, such as an official certificate courtesy of Companies House, will be needed as well.
The uses as well as the convenience of having a separate bank account exclusively for business are worth every dime. This is an interesting statement, because they don’t cost anything. The only thing other than the obvious business expenses would be the affordable price of obtaining a virtual business address.
Among all the other alternatives to a home address, the virtual address is usually the best one because of how practical it is across borders. This is the best route for small business owners currently using their personal accounts.