What type of bank account do I need when starting a business?
One of the first things you may want to set up is a business bank account1,which for ease of accounting and reporting is separate from any personal accounts. It will record your income and outgoings, making it an important source of information at tax and BAS (Business Activity Statement) time.
This 'business transaction account' should be simple and reliable, and easily linked to and from any other business accounts you hold. Armed with an Australian Business Number (ABN) if you are a sole trader or Australian Company Number (ACN) if you are a company, you can generally apply for a business bank account online in minutes. Read more about these company structures in our Choosing a business structure article.
How do I open a business bank account?
As long as your business operates in Australia and you’re over 18, you should be able to apply for a business account online or drop into any branch.
What do I need to open a business bank account?
Banks are required to check ID – either online or in branch – before they can open a bank account for a business. Various options are available, but these are the most common:
- Australian driver licence
- Passport
- Australian birth certificate
- Recent utility bill in applicant’s name
You may also need to go into a branch for a document check to verify your business details. Find out what information Westpac needs from new customers.
How long does it take to open a business bank account?
If you’re a simple business entity such as a sole trader and you have your ID handy, it can take just a few minutes to open a business account online. More complex businesses with multiple signatories will have to go into a branch for an ID and document check.
Is it easy to switch banks?
Changing banks may be simpler than you think, including moving your business finances from a personal account to a business bank account.Read our switching banks article.
How can I enhance my business banking security?
When setting up your business bank account(s) you'll need to decide how many extra signatories you'll need (if any) and who needs access, such as your accountant or payroll employee.
You may also wish to consider extra security, such as a second-factor authentication token. These keyring-sized devices give authorised signatories access to specific account functions, including payments above any pre-determined daily limits.
What's the simplest way to manage my account?
Online banking gives you the flexibility to check balances, transfer funds and reconcile payments on the go 24/7. If you choose Westpac Online Banking1you can register online as a sole trader or partnership, or in a branch if you're a company.
What are the advantages of a business credit card?
Business credit cards1could be a useful way to manage and reconcile business purchases, and any interest free periods offered may help with your cash flow. Additionally, business expenses paid using some credit cards can earn rewards points, which can be spent on things such as gift vouchers, travel and merchandise.
Fees and charges may apply, so it's best to compare the options available and choose the business credit card that matches your needs.
How can I accept payments for my business?
Business banking offers a number of payment solutions for businesses, but the smart way to get paid faster is to give your customers the simplest possible way to pay. This could be through bank transfers or other types of online payment, or EFTPOS1if you're operating a shop, café or restaurant.
Things to consider include any applicable fees, plus the process for moving payments into your business transaction account – always remembering that the sooner you have access to customer payments, the healthier your cash flow will be.
What should I do with surplus cash?
Even if it's just for short periods, it may be worth moving money into a savings account1to gain extra interest, when compared to non-interest earning transaction accounts. This could also be a good way to set aside funds required for future payments, such as your quarterly BAS submissions.
Some savings accounts are free to set up and maintain, so you could open a number to keep your funds segregated for different purposes. Moving funds between accounts is quick and simple through online banking.
If you want the certainty of a fixed rate (rather than a variable savings account rate) and are happy to lock your money away for a specific period, a term deposit may be the way to go. If you already have a Westpac transaction account, a business term deposit1can be set up through online banking, without the need to visit a branch.
