OneUp also includes easy product and service setup, as well as the ability to link bank accounts and other financial institutions with the application. FreshBooks is a good fit for self-employed business owners, but, with four plans available, it can also grow along with you. And because FreshBooks does not offer a payroll plan, it remains a terrific option for self-employed individuals and sole proprietors who don’t have a staff to pay. It is not a requirement to use an accountant as a sole trader however they are helpful and save you time with your tax return, BAS and PAYG instalments.

Particularly well-suited for businesses that sell products and need to manage inventory, Zoho Books also works with several online payment gateways for easy customer payment. FreshBooks makes it easier than ever for you to get paid with simple, secure online payments. Clients can pay by credit card straight from an invoice with just a couple of quick clicks. With high-level encryption and first-class security, your clients don’t have to worry about payment protection.

Tide — Best Overall Online Business Bank Account for Sole Traders

If customization is required, you can export any report as a CSV file if desired. One of the greatest benefits you can derive from using Xero is its ability to integrate with more than 700 apps in a variety of categories, which is a major plus for niche businesses. Xero also contains budgeting capability so you can create an organizational budget as well as a departmental budget or project budget if needed.

If you are keen to grow your business, we can help you with all other accounting and tax requirements as you grow too. If you are self-employed part-time – say you work on your business in the evenings – you may not make many transactions in a month. In this case, you might want to look for a business account which charges per transaction, so you only pay for the features you actually use. Running a business on your own means you have limited resources and skills compared to larger businesses or those with multiple employees. You may face challenges in handling all aspects of the business, such as accounting, marketing, operations, and customer service, which can be overwhelming and may lead to inefficiencies.

The Tax Advantages of Running a Business From Home

For example, if you sell products, you’ll want an application that offers inventory management, while those that offer services will find time-tracking capability a major plus. Mettle is a great online bank option for sole traders in the UK who are seeking maximum simplicity. Because the bank accounts are issued by NatWest, you get all of the benefits of deposit insurance and security while still enjoying the user-friendly features designed by a fin-tech company. With no fees for sign-up, monthly maintenance, domestic transactions, or cash deposits, Mettle is one of the cheapest options on this list. Starling Bank’s multi-currency add-ons will certainly assist businesses that have important partners or suppliers in Europe or the US.

Make effortless real-time banking a reality whilst being a sole trader. Connect Pandle to your bank accounts and payment platforms allowing you to focus while transactions flow straight in. Sole proprietorships tend to be closely held businesses, and many sole proprietors do most or all of the work required to keep their companies sole trader bookkeeping running. You may or may not have the necessary skills to perform the bookkeeping tasks that your sole proprietorship requires. Even if you hire someone else to do your bookkeeping, you should still familiarize yourself with the information summarized in your accounting reports because these documents provide invaluable data.

How to choose the best deal for my sole trader bank account

Wise is a money transfer operator located in the UK and, according to our rankings, the best money transfer service on the market. They may also charge you for transactions, such as a percentage of deposits made, or for using your debit card. Some sole trader business accounts will offer a free initial period, but will start to charge you after that period ends.

The plan also helps connect sole traders with bookkeepers and accountants, often a significant moment for a growing business. As soon as you’ve become self-employed, you should let HMRC know that you’re operating as a sole trader by registering for their online services. You also need to notify HMRC that you intend to pay your taxes through the Self Assessment tax return. As a sole trader you’ll need to file this tax return on a yearly basis. When registering as a sole trader, you typically have to provide your name, address, date of birth, phone number, NI number, business name, business type and start date.

Principles and Importance of Accounting for a Business

You may benefit from greater tax savings if you run your business as a limited company, particularly if your profits go above a certain threshold. That’s because limited companies pay 19% Corporation Tax on their profits, compared to the 20-45% Income Tax that sole traders pay on their profits. That’s because unlike a limited company, a sole trader business isn’t a separate legal entity; the law doesn’t distinguish between the individual running the business and the business itself.