5 Reasons to Separate Personal From Business Banking

Each account is a financial tool with an important role to play. Money management is a skill that can take time to master. However, no business owner can afford to let this one slip through the cracks. Keeping a close eye on your incomings and outgoings from the outset is critical to keeping doors open. One of the simplest and most effective techniques to effectively manage your money is to set up three separate accounts: operating account tax account profit account. Each account has its own purpose. By keeping your funds in separate accounts, you will always have enough money on hand to carry you through quieter periods, take care of your tax obligations, or spend in case of emergencies. When you sign up for Zeller, you get a free Zeller Transaction Account . Setting up multiple Zeller Transaction Accounts is simple, and can be done in seconds. What is a business bank account? A business bank account is a facility that protects a business’s capital while enabling it to spend its funds. You’ll use a business account to receive payments from customers, fulfill invoices, track business expenses, and generally keep your accountant happy. A business bank account is not a personal account. For tax and bookkeeping purposes, banks, accountants and payments providers strongly recommend that merchants separate personal from business funds in separate accounts. To open a business account, business owners used to need to gather their documentation together, visit a bank branch in person to meet with a representative, and then send various forms via fax, postal or electronic mail. Eventually, you’d receive a card and checkbook in the mail. Instead, you can sign up for a free Zeller Transaction Account in minutes. A  Zeller Terminal can be purchased from the online shop , with free express shipping and same-day dispatch. Funds accepted via Zeller Terminal will be available in your Zeller Transaction Account for spending, the very next day, or you can simply use Zeller as your primary financial services provider without taking payments through Zeller Terminal. When comparing business accounts, it’s important to spend time on working out what’s important to you and which features your business needs. Read our blog about opening your first business account. 3 important accounts to open There are three basic business accounts you should consider opening. Of course, there are more sophisticated ways of managing your funds; you could be pouring over your budget every day. However, for simple and straightforward money management, keep reading. Zeller merchants can set up multiple sub-accounts to tailor their funds management to fit their unique business set-up. Not only does this give you a better overview of your business's finances, it also gives you the ability to more easily manage your money — with quick and seamless transactions between your main and sub-accounts. Here are the three accounts every small business owner needs. 1. Operating account The first account you’ll need is your operating account. Your operating account is where you run the day-to-day operations of your business. It’s where you: receive your income pay your bill pay your wages and so much more. Basically, all your day-to-day cash inflows and outflows go through this account. Most businesses should have one of these accounts already. For most Zeller merchants, this will be your Zeller Transaction Account . Funds are collected from your Zeller Terminal , settled and cleared into your Zeller Transaction Account overnight — so they’re available for spending the very next day. It’s the fasted way to get access to your takings and speed up your cash flow. Sign up for Zeller and you could have your Business Transaction Account in less than five minutes. Once your account is set up, stop using cash and do all your transactions electronically. If you’re paying suppliers in cash, it’s easy to lose track of the payment. If you pay electronically, you can always find a record of the transaction — ensuring you don’t miss out on claiming GST (if you are registered for it), or other tax deductions. Bigger businesses may choose to use a traditional bank for their operating account, because they offer overdraft facilities (subject to approval). These banks likely charge a monthly fee for the service. 2. Tax account The second account that you’ll need is your tax account. Your tax account is where you start putting money aside for tax. By separating it from your operating account, you will be less likely to spend it. It's easy to accumulate funds in your account, forgetting that at some point down the line there's tax to pay. Entrepreneurs and business are legally obliged to pay a number of different taxes, such as sales tax, trade tax, income tax, and wage tax. When you first start trading, you’re not paying tax on your earnings. But the year after you lodge your first tax return in net profit, you get a tax bill for that year — plus all of a sudden you also have to pay PAYG installments. Depending on which type of tax you pay, you will be required to make specific quarterly or monthly payments in advance to tax authorities. These advance payments help your business to budget and plan ahead, by spreading the business’s tax burden over the entire year. If you set aside money in a sub-account on a regular basis, it can help to make sure that you have sufficient financial resources available to pay your taxes on time. Each week or each month, start to put money aside money that will cover your obligations such as: Good and Services Tax (GST) Pay As You Go Tax (PAYG) superannuation income tax, and so on. 3. Profit Account Finally, the third account you’ll need is a profit account. This is where you put money aside for the profits of your business. So, as your business makes a profit, simply put a portion of that money aside. Again, if you leave it in your operating account, it’s far easier to spend. But if you put it aside in your profit account, it will be available when you want to make any changes in the business. This could be things like: paying out dividends purchasing new tools or assets for your business reinvest in the growth of your business giving all your staff a bonus investing in additional COVID-safe measures. The beauty of starting to manage your money this way is that you’ll be able to start choosing where you spend your accumulating profits, rather than your takings being simply absorbed in the day-to-day operations. Set these three accounts up today and use them frequently — you’ll soon find that you’ll have the money that you’ll need to scale your business. Once your business grows, it’s a good idea to look for a high-interest business savings account. This will let you earn interest on extra funds that you don’t need right now; effectively, it’s another revenue stream as it allows you to make money on business assets. Introducing smarter business banking With Zeller, you can accept payments from customers, track spending and manage your business's finances online. It’s an all-in-one solution for merchants looking for the most straightforward way to start or grow their business — no hidden fees or lock-in contracts required. In Zeller Dashboard , you can see: details of every sale the number and value of sales your business has made at any point on time where business funds have been spent account totals and so much more. By putting valuable insights at your fingertips, we hope to enable Zeller merchants to be able to make important business decisions with ease. Sign up to the Zeller Business Blog for more business tips delivered straight to your inbox. Please note this article is for educational purposes only and does not constitute advice.

What is necessary to open a business account? To open a business transaction account , you’ll need to provide: certified copies of identification documents, such as a passport or driver’s licence details of your business proof your business exists, such as a website and social media profiles Additional documents may be required if your business operates under a particular structure.  For example, if your business operates under a trust, documents identifying the beneficiaries of that trust may be required for account verification. Further, traditional banks often require you to visit a bank branch in person in order to set up a business account. Wondering how to set up a business account, or how to open a transaction account online? The easiest way is to sign up for Zeller. In just 5 minutes, most businesses can be up and running with a free Zeller Transaction Account . Once set up, you can create as many accounts as you like to separate business funds — and link each to a Zeller Debit Card for simple, trackable spending. Let’s dive deeper into the details, so that you can make an informed decision about the best account for your business. What is a business account? A business account is an account traditionally offered by incumbent banks. In recent years, digital banks and neobanks have introduced similar offerings. Business bank accounts offer a single place to accept deposits and make payments, while keeping your business and personal finances separate. A transaction account enables you to do the same. A business account itself is pretty straightforward. Different banks and alternative providers offer additional features and services, on top of the base offering, which usually come with extra costs. Fees including, but not limited to, monthly account fees and minimum deposit fees are important to keep in mind. Focus on finding an account that aligns with your specific needs in order to keep fees to a minimum. Why open a business account? There are a multitude of benefits that come with opening a separate account for business purposes. For one, setting up a business account can make bookkeeping less of a headache — especially at tax time. A business account also helps you stay in line with the relevant government rules and regulations. The Australian Taxation Office stipulates that ventures operating as a company, partnership or trust must have a business account for tax compliance. And, while sole traders don’t face the same requirement, a business account provides the same benefit of keeping personal and professional transactions separate. Once your business account is set up, you’ll have a clear path to sharing important information with your accountant or handling your tax obligations yourself. Business accounts also give you a clear view of your business finances. All of the relevant transactions are tracked in one place, making it straightforward to look at recent activity and identify any potential areas for concern. Opening a business account also helps your company appear more mature and professional. While customers won’t notice the difference at the point of sale, they will likely see it when reviewing their monthly statement. The legitimacy a business account offers can also encourage suppliers and vendors to form a relationship with you. When you hear the term “business bank account”, it’s usually in reference to a transaction account. This type of account is used to make and receive business payments on a daily basis. A business savings account is another type of business bank account, very similar to a personal savings account. These types of accounts serve as a place to deposit and hold money for longer periods of time. Who can open a business account? Banks and other providers of financial services have a number of rules and security measures in place to make sure anyone attempting to open a business account is doing so in good faith — and is eligible to receive one in the first place. The requirements for opening a business account are strictly defined but straightforward, at least as far as the highly regulated world of banking is concerned. You may be asked to provide a variety of documents and information to prove your business is legitimate and eligible for an account. This mostly involves things you likely have on hand right now or can quickly access, such as your company’s full name, Australian Business Number, and tax file number. The physical and registered address of a business are also commonly requested. You will also need to identify key parties, including both company directors and any employees who will access the account. You, your partners, and potentially your staff may need to produce passports or a certified copy of drivers licences. When should I open a business account? Opening a business bank account makes everything from tax time to accepting customer payments easier. As Australians increasingly move to using debit and credit cards for everyday purchases, this will only become more important. A business account is foundational for smoothly processing card and online payments and keeping track of your business’s finances. You should be looking to set up a business account as soon as you’ve set your business in motion. You’ll need to set aside some time to gather the needed documents and information, but accounts that offer online registration will save you precious hours (and, in some cases, days). You’ll also need to give some thought to the impact any fees will have on your budget. To save on fees, look for providers who are upfront about the costs of using their platform. How can I open a business account? Understanding how to open a business transaction account and set it up correctly is crucial. It streamlines day-to-day management of your finances and makes your business appear more professional. And, in many cases, a business account isn’t just a smart idea — it’s a requirement. You have plenty of choices when it comes to choosing a business account. There are traditional banks, of course, but their offerings don’t always align with the needs of modern business owners. High fees, excessive paperwork, and long application processes can sap your energy, turning what should be a basic task into a drawn-out process. These are just some of the reasons why Australian Businesses aren’t satisfied with the Big 4 banks — and why we built Zeller. We’re reimagining business banking for Australian merchants. With Zeller, you can sign up in minutes and begin taking payment. Discover how our fee-free Zeller Transaction Account , used in conjunction with Zeller Terminal and Zeller Debit Card , can help accelerate your cash flow and grow your business.

Discover a better way to store and spend business funds. Zeller Transaction Account is a powerful business transaction account that makes keeping on top  of your spending, transactions, payments, settlements and invoices, and making managing your business financial health simple and straightforward. When you sign up for Zeller, you get a free Zeller Transaction Account instantly  — there’s no paperwork or need to visit a bank. Some business bank accounts are outdated. Many are simply a secure place to store funds. With Zeller Transaction Account, you can replace your outdated business bank account with next-gen technology that gives you one place to see your incoming and outgoing transactions in real time, understand customer and business spending, and track payments across your entire business — right from your computer or smartphone. New enhancements make the Zeller Transaction Account the most powerful transaction account for any business stage or type. Whether you operate a start-up or a scale-up, sell face-to-face or online, or manage contractors as part of an agency, Zeller has the right financial services solution for you. Zeller Transaction Account can be used together with other Zeller products, or as a standalone Transaction Account for businesses that: need a place to settle funds to don’t have an established banking history, yet need a transaction account fast want solutions to help manage expenses across a wide range of employee or contractor types, without the fuss. Keep reading to discover how Zeller Transaction Accounts work. An all-in-one solution Zeller’s suite of products support all of your business’ financial needs. Funds accepted via Zeller Terminal are settled to your Zeller Transaction Account nightly, 365 days a year, and then instantly available to spend with your Zeller Debit Card . Plus, with your own Account Number and BSB, you can invite customers, clients and other third parties to transfer funds directly to your account when paying your business for invoices. Alternatively, Zeller Transaction Account can be used as a standalone business account to store, save and manage your funds. Meet your new Transaction Account Zeller Transaction Account is an all-in-one business account for growth-minded merchants. Complete with BSB and Account Number, it’s packed with all of the tools you need to manage, categorise and spend business funds. Instant setup Create your Zeller Transaction Account in a few simple steps online , with no lengthy paperwork or need to visit a bank branch. In fact, it’s the fastest and simplest way to sign up for a business transaction account, anywhere in the world — most business owners can be set up with a new account in under 5 minutes. You can create as many free Transaction Accounts as your business needs — whether that’s one for every business location, one for saving and another to store petty cash for employees to spend with their Zeller Debit Cards , or any other setup. No matter your business stage or type, Zeller can support the way you run your business. Real-time and unlimited transfers Outdated business banks will make you wait days to receive your funds — and even longer on weekends and public holidays. With Zeller Transaction Account, funds are transferred in real-time. Powered by the New Payments Platform, Zeller enables faster, simpler, smarter payments for every business. With your Zeller Transaction Account, you can send and receive funds in real-time for instant cash flow. All businesses need fast cash flow. Whether you're a market merchant needing their funds settled to buy fresh produce, an agency wanting to pay its contractors faster for completed work, or an online seller needing to pay a drop-shipper to release the goods so you can fulfil orders — Zeller’s nightly settlement gives you the fastest way to access your hard-earned money. Instant, fee-free spending Create and issue virtual Zeller Debit Cards, or order physical cards, online in an instant. Then, connect your card to one of your Zeller Transaction Accounts so you and your staff can spend business funds to make purchases in-store and online. Simple expense management Zeller Transaction Account is the most powerful account for modern businesses. That means you have the ability to upload receipts, add notes, categorise transactions, and assign contacts to transactions so you better understand the customers spending with your businesses as well as the businesses you’re purchasing from. Powerful business insights Real-time transaction lists and reporting, available in both Zeller Dashboard and the Zeller App (coming soon), empower you with the insights you need to run a successful business. Plus, funds settled to and withdrawn from your account are easily accessible, from wherever business takes you. Xero Bank Feeds integration Rely on Zeller’s up-to-the-minute integration with Xero bank feeds to reduce the admin load of manual transaction uploads and reconciliations. When funds are settled to your Zeller Transaction Account, transaction information appears in your Xero organisation instantly. Secure access can be granted to third parties like your bookkeeper or accountant, ensuring you’re working as efficiently as possible from the exact same data. Get started today Zeller Transaction Account gives you complete oversight of your finances to help you make smarter business decisions. Having the ability to see your true financial position at any point in time enables you to identify opportunities for business growth and see where savings could be made. Open your free Zeller Transaction Account online in minutes today.