As the gig economy continues to grow, more and more people are choosing to work freelance.
While freelancing can offer a great deal of flexibility and autonomy, it also comes with a unique set of challenges, particularly when it comes to managing finances. One of the most important decisions a freelancer can make is choosing the right bank account.
As a freelancer, a good bank account can help you manage your income, expenses, and taxes more easily while also providing access to essential financial services.
In this article, we’ll explore the importance of choosing the right bank account, discuss the criteria you should use when researching, and highlight some of the best bank accounts for freelancers on the market today.
- Our Verdict
- Do Freelancers Need a Business Bank Account?
- 6 Best Business Bank Accounts for Freelancers in the UK
- Best Traditional Bank Accounts for Freelancers
- Best Bank Accounts for Freelancers & Digital Nomads
- Comparing the Top Freelancer Business Bank Accounts
- Additional Tips
- What’s The Most Ethical Bank For Freelancers?
- FAQs
The Best Business Bank Accounts for Freelancers: Our Verdict
- Anna: Best Overall Freelancer Bank Account
- Tide: Best Free Account for Freelancers
- Revolut: Best International Freelancer Account
- Instant Invoice Generation
- Good customer service via Live Chat
- Xero Integration
- Easy VAT submission to HMRC via App
- To open a business account, you’ll need a photo of your full driving licence or a photo of your valid passport.
- You can apply from outside the UK, but only if you’re a UK resident
- Anna carry out an identity check for new acccounts but not a credit check
Eligibility Criteria
You need a UK residential address to open an account. This account isn’t open to charities.
- One of the best Apps in the sector
- No Monthly or Annual Fees
- Easy Invoice Creation Functionality
- Post Office Deposits Cost £1
- 20p charge for transfers between accounts
- 3% charge for cash deposits at Paypoints
Eligibility Criteria
You must be 18 years or over, a UK resident, and have a valid UK phone number.
To qualify for Tide’s Black Friday Deal and get £100 cashback, all you need to do is spend £500 or more via your new account with them within the first 90 days of opening. This deal is valid from 20/11/2023 – 30/11/2023.
- Ecommerce – Easy integration with Ecommerce via Apps and Plugins
- International payments – Send and receive money from 200 countries
- Block cards or set accounting limits with a tap
- Available for Limited Companies Only
- Accounts do not support cash or cheque deposit
Do Freelancers Need a Business Bank Account?
In the UK, freelancers are not legally required to have a separate business bank account, but considering one is still a good idea. Having a separate business account can help you manage your finances more easily, especially when it comes to tracking income and expenses, which is essential for accurate tax reporting.
Additionally, having a business bank account can give your freelance business a more professional image, which can be important when dealing with clients or suppliers. It can also provide an easier way for clients to pay you, as many prefer to pay by bank transfer, and having a business account can help to facilitate this.
Furthermore, having a separate business bank account can make it easier to access financing if you need it. When applying for a loan or credit, lenders will often want to see a clear financial record of your business, and having a separate business bank account can provide this.
What Should Freelancers Consider When Comparing Bank Accounts?
When evaluating bank accounts for freelancers, there are several criteria to consider. Here are some of the most important:
- Fees: Look for accounts with low or no monthly fees, as well as accounts with low transaction fees, foreign exchange fees, and ATM withdrawal fees. Some accounts may also offer fee waivers for specific transactions or for maintaining a minimum balance.
- Payment processing: Look for accounts that offer convenient and secure payment processing options, such as online payment gateways, direct deposit, and mobile payment apps. Some accounts may offer payment reminders, automated invoicing, and payment tracking features.
- Integration with accounting software: Consider accounts that integrate with popular accounting software, such as QuickBooks or Xero. Automating financial record-keeping and simplifying tax preparation can save time and effort.
- Access to credit: Look for accounts that offer overdraft facilities, access to finance, or credit cards, as these can provide a much-needed financial cushion for unexpected expenses or business investments.
- Customer service: Consider the quality of customer service the bank offers, including availability, responsiveness, and helpfulness. Look for accounts that offer 24/7 customer service and easy-to-use online banking features.
- International capabilities: If you work with clients or suppliers overseas, consider accounts that offer international payment capabilities, such as multi-currency accounts, foreign exchange services, and international wire transfers.
6 Best Business Bank Accounts for Freelancers in the UK
Tide: Best Free Bank Account for Freelancers
Tide has rapidly gained popularity since its launch in 2015, attracting over 400,000 customers. The main draw for many freelancers is the ability to set up a business account and start invoicing within minutes of making an application, thanks to its quick and simple onboarding process. While there are no monthly fees, a small 20p charge applies for each transfer in and out of the account, which can add up if you conduct numerous transactions.
Tide’s app is a standout feature, offering various useful functions that simplify the process of tracking expenses and payments. You can send, pay and track invoices and upload receipts that automatically match transactions, making it easier to keep tabs on your finances. Moreover, the account integrates seamlessly with popular accounting software such as Quickbooks, Xero, and Sage.
For freelancers who require additional services such as phone support and a 24/7 legal helpline, Tide offers a Plus account that includes these features for a monthly fee of £9.99. Furthermore, Tide supports those looking to transition from a sole trader to a limited company, providing assistance with the company registration process and offering virtual office addresses.
The account is available to UK-based freelancers aged 18 or above with a valid UK phone number, address, and a compatible smart device to download the app.
- One of the best Apps in the sector
- No Monthly or Annual Fees
- Easy Invoice Creation Functionality
- Post Office Deposits Cost £1
- 20p charge for transfers between accounts
- 3% charge for cash deposits at Paypoints
Eligibility Criteria
You must be 18 years or over, a UK resident, and have a valid UK phone number.
To qualify for Tide’s Black Friday Deal and get £100 cashback, all you need to do is spend £500 or more via your new account with them within the first 90 days of opening. This deal is valid from 20/11/2023 – 30/11/2023.
Revolut: Best International Freelancer Bank Account
Revolut is a fantastic option for freelancers who want to take control of their finances. With the Pro account, you can create a separate business account with its own account number and debit card, making it easy to manage your business finances. And the best part? There are no joining requirements or monthly fees!
With Revolut Pro, you can earn 1% cashback on all card purchases, so you can save money while you spend. Plus, the account can be set up in just a few minutes within the Revolut app, and it offers a range of useful features, including multi-currency payments, instant payments, and the ability to accept payments in-person or online.
Overall, Revolut Pro is a great choice for freelancers who want a hassle-free way to manage their business finances and get rewarded for their spending. To be eligible for a Revolut Pro account, you must have a Revolut Personal account and be self-employed (not a company). It’s important to note that the account should only be used for business purposes, and you’ll need to pass Revolut’s onboarding checks.
- Ecommerce – Easy integration with Ecommerce via Apps and Plugins
- International payments – Send and receive money from 200 countries
- Block cards or set accounting limits with a tap
- Available for Limited Companies Only
- Accounts do not support cash or cheque deposit
Anna Money: Best Overall Freelancer Bank Account
Anna Money is another popular freelancer bank account option, providing various benefits to help manage your finances. One of the most appealing features is its intelligent financial assistant, Anna, who can help with tasks like invoicing, tracking expenses and setting reminders.
With no monthly fees, Anna Money offers free account setup and an easy-to-use app, plus you can apply and open your account from your smartphone in just a few minutes.
Other features include automatically categorising your transactions, which can be customized to suit your business and seamless integration with accounting software like Xero and FreeAgent. Plus, there are no fees for incoming or outgoing transfers, and a dedicated customer support team is always on hand to help you out.
For those who want extra benefits, Anna Money offers a premium account for just £11 a month, which includes features like multiple-user access, additional cards for team members, and unlimited invoicing. With its user-friendly interface and AI-powered financial assistant, Anna Money is a solid choice for freelancers looking for a smart, streamlined banking solution.
- Instant Invoice Generation
- Good customer service via Live Chat
- Xero Integration
- Easy VAT submission to HMRC via App
- To open a business account, you’ll need a photo of your full driving licence or a photo of your valid passport.
- You can apply from outside the UK, but only if you’re a UK resident
- Anna carry out an identity check for new acccounts but not a credit check
Eligibility Criteria
You need a UK residential address to open an account. This account isn’t open to charities.
Starling: Joint Best Bank Account for Freelancers (with Tide)
Starling’s sole trade account is ideal for freelancers. It offers a free, straightforward account opening process, 24/7 UK-based support, and no hidden fees. There are no monthly account fees, UK transfer fees, bank ATM fees, or fees for using the account abroad.
We like the instant payment alerts that provide real-time notifications when money enters or leaves your account. The app also lets you capture receipts as you go, making it easier to stay organized and track expenses. Additionally, Starling automates expenses by putting them into business categories to simplify your self-assessment tax return.
Freelancers can connect their Starling account to other services, such as accounting software or insurance, through the Marketplace. Starling also allows free integration with popular accounting software like Xero, QuickBooks, and FreeAgent.
Starling’s Saving Spaces feature provides a space to separate overheads, making it easier to set aside funds for expenses like business trips, taxes, or new equipment. The app’s Bills Manager feature also enables freelancers to pay Direct Debits and standing orders straight from a Saving Space, providing greater control over expenses.
Despite not having branches, Starling allows for easy cash deposits at local Post Offices, and cheque deposits of £1000 or less can be made through the app.
These features make Starling a strong option for freelancers seeking a user-friendly banking experience.
Monzo: Runner up Best Freelancer Bank Account
Freelancers looking for a fully regulated bank with a quick mobile set-up process may find Monzo a good option. Both Monzo’s business accounts are open to freelancers: Monzo’s Lite account is fee-free but does not integrate with any accounting software, while Monzo’s Pro account, which costs £5 per month, offers extra features such as integration with accounting software like Xero, FreeAgent, and Quickbooks and simple invoicing.
Monzo Pro offers a six-month free subscription to Xero and customer offers, including discounts from popular brands.
You can also get a business debit card, 24/7 customer support, free, instant UK bank transfers, Pots to separate money, instant notifications, budget and categorise spending, digital receipts, outbound international payments, fee-free spending abroad, manage scheduled payments, pay in cash and cheques, and £85,000 FSCS protection (if eligible).
Business Pro offers additional features like Tax Pots, integrated accounting, multi-user access, invoicing, exclusive offers, 6 months of Xero free, virtual cards, and the ability auto-export transactions.
Mettle: Best ‘Completely Free’ Freelancer Bank Account
Mettle is a specialist freelancer account created by the trusted and regulated NatWest bank. It’s an attempt to create the kind of simple, user-friendly banking experience that has catalysed the growth of challengers like Tide.
We think Mettle is an excellent option for freelancers. The account is 100% free and has a straightforward application process that can be completed in just minutes from the app. Freelancers can easily send and receive UK payments with a UK account number and sort code.
Like most freelancer accounts, Mettle offers the ability to create and send invoices on the go, with the app notifying users when the money hits their account and matching payments to the invoice. Additionally, the app allows users to categorise business transactions, which reduces admin time and minimizes errors. This feature is particularly useful for freelancers who want to stay organized and avoid the hassle of manual categorisation.
Mettle also integrates with popular accounting software like FreeAgent, Xero, and Quickbooks, making it easy to manage finances and share data with an accountant. The app provides support from real people whenever freelancers need it, ensuring they have assistance at every step.
Best Traditional Bank Accounts for Freelancers
While online bank accounts are often the preferred choice for freelancers due to their low fees and range of features, some traditional bank accounts still offer great options for freelancers. Of course, using a traditional bank will give you access to requirements such as an overdraft or access to finance, which many of the challenger banks don’t offer.
- HSBC Business Banking: HSBC offers a range of business banking options, including business bank accounts, loans, and credit cards. HSBC’s business bank account is designed for small businesses, including freelancers, and offers features such as free banking for 18 months, a debit card, and online banking.
- Barclays Business Banking: Barclays offers a range of business banking options, including business bank accounts, loans, and credit cards. Barclays’ business bank account is designed for small businesses and offers features such as free banking for 12 months, a debit card, and online banking.
- NatWest Business Banking: NatWest offers a range of business banking options, including business bank accounts, loans, and credit cards. NatWest’s business bank account is designed for small businesses, including freelancers, and offers features such as free banking for 18 months, a debit card, and online banking.
- Lloyds Business Banking: Lloyds offers a range of business banking options, including business bank accounts, loans, and credit cards. Lloyds’ business bank account is designed for small businesses, including freelancers, and offers features such as free banking for 18 months, a debit card, and online banking.
Best Bank Accounts for Freelancers & Digital Nomads Working Internationally
Here are the criteria we feel a freelancer would consider important when looking for a bank account that suits their needs:
- International Money Transfers: Look for a bank account that offers international transfers with competitive exchange rates, low fees, and quick processing times.
- Low Fees: Look for a bank account that offers low or no fees for basic transactions, such as online banking, ATM withdrawals, and debit card usage.
- Multi-Currency Accounts: Look for a bank account that offers multi-currency accounts with competitive exchange rates and low fees.
- Online Banking: Look for a bank account with a user-friendly online banking platform offering features like bill payments, transaction history, and account statements.
- Mobile Banking: Look for a bank account with a mobile banking app that offers features such as account balance, transaction history, and mobile payments.
- Customer Support: Look for a bank account with 24/7 customer support, multiple communication channels, and knowledgeable staff.
- Credit and Debit Cards: Look for a bank account that offers credit or debit cards with low or no fees for international transactions and ATM withdrawals.
Here are our top two choices for international freelancers:
Wise (formerly TransferWise)
Wise is an online bank account designed specifically for international freelancers. Wise offers a range of features, such as multi-currency accounts, international payments, and low fees for currency exchange. Wise also offers a debit card and integrates with popular accounting software.
- Typically one of the most cost-effective providers, although the sector is now very competitive
- 80% of payments are settled within 24 hours, and 35% of the total are instant
- complete transparency on all fees;
- No bank branches
- No cash deposits or transactions
- No credit or business loan facilities are available
Eligibility Criteria
Almost all businesses are eligible; there is no credit check required.
Revolut
Revolut is another online bank account that is great for international freelancers, offering features such as multi-currency accounts, foreign exchange services, and international payments. Revolut also offers a debit card and premium accounts that offer additional features like travel insurance.
Comparing the Top Freelancer Business Bank Accounts
| Criteria | Starling Bank | Monzo | Mettle | Tide | Revolut | Anna Money |
|---|---|---|---|---|---|---|
| Fees | No monthly fees | 0-£5/month | No monthly fees | £0-£18.99/month | £0-£25/month | £0-£11/month |
| Cash Deposits | ✓ | ✓ | ✓ | ✓ | X | ✓ |
| ATM withdrawal charge | Free | Free | Free | £1 | 2% on all withdrawals | Free |
| Fee-Free Spending Abroad | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ |
| Customer Service | 24/7 support | 24/7 support | 9am-5pm support | 24/7 support | 24/7 support | 24/7 support |
| Accounting Integrations | Xero, FreeAgent, Quickbooks, PayStream | Xero, FreeAgent, QuickBooks | FreeAgent, Xero or Quickbooks | Xero, Sage, Freeagent, Coconut, Kashflow, Quickbooks, Crunch, Clearbooks | Freshbooks, Quickbooks, Zoho Books, Clearbooks, Xero, Freeagent | Xero, QuickBooks, and more |
| Invoice From App | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ |
| Security and Fraud Protection | biometric login, freeze card feature | biometric login, freeze card feature | biometric login, freeze card feature | biometric login, freeze card feature | Fbiometric login, freeze card feature | biometric login, freeze card feature |
| FSCS protection | ✓ | ✓ | ✓ | ✓ | X | X |
Additional Tips for Freelancers When Choosing a Bank Account
- Consider your specific needs: Different freelancers have different financial needs, so choosing a bank account that aligns with your specific requirements is important. For example, if you work internationally, you may need a bank account that offers multi-currency accounts and low fees for currency exchange.
- Evaluate fees carefully: While low fees are important, it’s also important to evaluate fees carefully to ensure that you’re not sacrificing important features or benefits for the sake of saving money.
- Look for integrations: If you use accounting software or other financial tools, look for bank accounts that integrate with these tools. Automating financial record-keeping and simplifying tax preparation can save time and effort.
- Research customer service: Look for bank accounts that offer good customer service, including availability, responsiveness, and helpfulness. This can be especially important if you encounter any issues or challenges with your account.
- Consider the bank’s reputation: Choose a bank with a strong reputation for stability and security, especially if you’re storing a significant amount of funds in your account.
- Read reviews and ask for recommendations: Reading reviews and asking for recommendations from other freelancers can provide valuable insights into the pros and cons of different bank accounts.
What’s The Most Ethical Bank For Freelancers?
Here are two banks that are recognized for their commitment to ethical and sustainable banking practices. Both offer current accounts suitable for freelancers
- Triodos Bank: Triodos Bank is a values-based bank that focuses on financing sustainable businesses and projects. Triodos Bank only lends to organizations that have a positive social or environmental impact, and it is transparent about where its money goes.
- The Co-operative Bank: The Co-operative Bank is another values-based bank that is committed to ethical banking practices. The bank has policies on issues such as human rights, climate change, and animal welfare, and it supports a range of ethical initiatives and campaigns.
Choose the Freelance Account that’s Right for You
- One of the best Apps in the sector
- No Monthly or Annual Fees
- Easy Invoice Creation Functionality
- Post Office Deposits Cost £1
- 20p charge for transfers between accounts
- 3% charge for cash deposits at Paypoints
Eligibility Criteria
You must be 18 years or over, a UK resident, and have a valid UK phone number.
To qualify for Tide’s Black Friday Deal and get £100 cashback, all you need to do is spend £500 or more via your new account with them within the first 90 days of opening. This deal is valid from 20/11/2023 – 30/11/2023.
- Ecommerce – Easy integration with Ecommerce via Apps and Plugins
- International payments – Send and receive money from 200 countries
- Block cards or set accounting limits with a tap
- Available for Limited Companies Only
- Accounts do not support cash or cheque deposit
- Instant Invoice Generation
- Good customer service via Live Chat
- Xero Integration
- Easy VAT submission to HMRC via App
- To open a business account, you’ll need a photo of your full driving licence or a photo of your valid passport.
- You can apply from outside the UK, but only if you’re a UK resident
- Anna carry out an identity check for new acccounts but not a credit check
Eligibility Criteria
You need a UK residential address to open an account. This account isn’t open to charities.
- Quick application process
- Free to join and use
- Issuing invoices is easy
- App includes expense management functionality
- Good integration with all major accountancy software providers
- If you lose your card, it’s simple to free it from within the APP.
- As an e-money account it’s not FSCS protected
- You can’t pay out more than £10,000 per day
- There isn’t any overdraft or credit card available
- Cheque deposits are not available
- International payments are not available
- Fast account set-up
- No monthly fees or fees overseas
- Integrations with Quickbooks, Xero & FreeAgent
- Fully regulated and FSCS protected
- Phone and App based customer service 24/7
- Pay Cash in via Post Office
- Euro and Dollar accounts are available
- There isn’t any overdraft facility
- There are no branches
- Starling charges for paying in money
- You can’t earn interest
- Depositing cash comes with a fee
Eligibility Criteria
All directors with access to the account must be UK residents. The business must not be a holding company, dissolved, in liquidation or engage in any activities set out in our terms and conditions. Evidence of your trading activities so we understand that your business does what you say it does. We can’t accept Companies House documents for this. Credit Checks May Apply
- Typically one of the most cost-effective providers, although the sector is now very competitive
- 80% of payments are settled within 24 hours, and 35% of the total are instant
- complete transparency on all fees;
- No bank branches
- No cash deposits or transactions
- No credit or business loan facilities are available
Eligibility Criteria
Almost all businesses are eligible; there is no credit check required.
Freelance Bank Account FAQs
Can I use my personal bank account for my freelance business?
Technically, yes, but it is not recommended. Mixing personal and business finances can lead to confusion, errors, and make it more difficult to track expenses and file taxes accurately.
Do I need a specific type of business bank account as a freelancer?
No, there is no one-size-fits-all account for freelancers. Consider your needs and the features offered by different banks before choosing an account that is best for you.
Can I get a business bank account as an international freelancer?
Yes, some banks offer international accounts specifically for freelancers and small businesses. Look for an account that offers international money transfers, low fees, and easy currency conversion.
What documents do I need to open a business bank account as a freelancer?
You will likely need to provide proof of identification, address, and business ownership, such as a business registration certificate or tax ID number. Requirements may vary by bank.
