Best Compare Business Savings Accounts
40 Best Business Savings Accounts in 2024
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How it worksBusiness savings accounts are a type of bank account that provide businesses the opportunity to earn a return on cash reserves. They typically offer much higher interest rates than standard business current accounts and don't tend to charge a monthly fee.
Find the best business savings account with the UK's leading providers and choose from a range of accounts to find the best rate for your business.
Tide Instant Saver Account
- Online business account best for easy access with market-leading variable rate
- Available to UK limited companies, sole traders & freelancers
- Offering one of the highest easy access rates at 4.33% AER & you can start saving from £1
- Calculated daily & paid into your saver account monthly
- Sign-up in minutes online or on mobile & open a free Tide bank account at the same time
- Get a £50 voucher when you sign up with code £50VOUCHER, T&Cs apply
- Manage everything in-app & have access to your savings at anytime
- With no fees for making withdrawals, deposits or holding an account
- Your money is protected up to £85,000 by the FSCS, the UK's deposit guarantee scheme
WebsiteRead our in-depth Tide reviewCynergy Bank Business Saver
- Digital business savings account with fast applications, however no app is available yet
- Made for sole traders, partnerships, limited liability partnerships & limited companies with up to 10 partners
- Offering one of the highest easy access rates, at 4.00% AER variable
- Which is paid monthly at 3.93% gross per annum
- Accounts can be opened from as little as £1 with no fees
- The maximum you can save up to is £10 million (one of the highest balance limits in this list)
- Your initial deposit must be received within 14 days of opening an account
- An interest-earning business current account is also available
- Eligible deposits are covered by the FSCS, up to the total of £85,000
WebsiteRead our in-depth Cynergy Bank reviewAllica Bank Business Savings Accounts
- Offering two fixed rate bonds with terms from six to 12 months, two notice & an easy access account
- That will earn you rates starting at 4.01% variable to 5.05% fixed AER
- Deposit from £20,000 to a maximum of £2 million, £100,000 for easy access account
- Funds can be added by Faster Payments, as CHAPs are not supported
- Open & manage the accounts 24/7 online
- Available for registered companies based in the UK
- Also available is the free, cashback Allica business current account
- Which earns 4.33% AER variable with its instant access savings pot
- Benefits from cover by the FSCS for eligible deposits up to £85,000
WebsiteRead our in-depth Allica Bank reviewRedwood Bank Savings Accounts
- Option of two notice accounts & one fixed business bond
- Earn from 3.75% variable to 4.65% AER fixed interest
- Interest is paid into a nominated current account either monthly or yearly
- Pay in from £10,000 up to £1 million maximum with unlimited top-ups
- No withdrawals are permitted until the end of maturity or notice has been given
- Applications take around 15 minutes through their website
- Either manage by post, phone or 24/7 securely online
- Can have a maximum of two savings accounts
- Awarded Best Business Variable Rate Deposit Account Provider in the Business Moneyfacts Awards 2019-24
WebsiteRead our in-depth Redwood Bank reviewRecognise Bank Business Savings Accounts
- Upcoming online bank offering business savings & financing options
- Choose between their easy access, notice & fixed rate accounts
- Earning interest rates between 3.15% to 4.50% AER
- Calculated daily & paid monthly or annually
- Paid into the account or a nominated business current account
- Deposit from £1,000 & save up to £250,000, if you're a limited company or LLP
- Or £85,000, across all Recognise accounts, if a sole trader or partnership
- Open & manage the account via secure, 24/7 online banking
- Benefit from FSCS protection up to £85,000 on eligible deposits
WebsiteRead our in-depth Recognise Bank reviewiFAST Global Bank Corporate Fixed Term Deposits
- Digital global bank that offers a choice of three fixed term savings
- With three, six & 12 month terms, earning fixed rates as high as 4.60% AER
- This is calculated daily & paid to your nominated business account at maturity
- Available to SMEs including limited companies incorporated in the UK
- Accounts are opened by email or post applications & require a minimum £10,000 deposit
- Once opened, you can manage by email or phone & balance statements are provided by either on request
- No withdrawals or further contributions are allowed during the specified term
- There are no maximum deposit limits with any of the saving terms
- Eligible small business deposits are covered by the FSCS to a total of £85,000
WebsiteRead our in-depth iFAST Global Bank reviewAldermore Business Savings Accounts
- Renowned bank offering award-winning easy access & fixed term accounts
- Interest rates range from 3.66% to 4.51% AER
- Calculated daily & paid monthly or annually
- All accounts have a minimum balance requirement of £1,000 & a maximum of £1 million
- Accessible via secure, 24/7 online banking
- Friendly UK customer support available Monday to Friday
- Savings up to £85,000 have FSCS protection
- Offers a range of business finance options
- Awarded Best Business Easy Access Account Provider 2023 & Best Fixed Rate Business Savings Provider 2023
WebsiteRead our in-depth Aldermore reviewRevolut Business Savings
- Online business accounts with daily-paid interest & annual subscription savings
- Rates start from 2.25% AER, on balances up to £500,000, for £19 per month
- Get 2.75% variable up to £1 million, costing £79 a month
- Or earn a maximum of 3.51% on up to £2 million, with custom pricing
- You will need less than 250 employees, turnover £36 million or less & hold £18 million or less
- Apply for a business account in a matter of minutes & grow your business with Revolut
- Manage everything effortlessly in-app & access or withdraw anytime
- Deposits held with trusted partner banks, protected by the FSCS, up to £85,000
WebsiteRead our in-depth Revolut reviewWise Business Interest
- Digital company offering easy access, multi-currency interest on their business account
- With variable rates of 4.66% AER on GBP, 3.67% on EUR & 5.05% on USD
- Rates include annual fees, which range from 0.27% to 0.56%
- Full access to your money so you can earn a return as you spend
- You'll need a Wise Business account to use Wise Interest, which costs £45
- 24/7 management with online & app access
- Trustpilot rating of 4.2 out of 5 stars
- Deposits may be be covered by the FSCS, through Wise Assets & BlackRock
WebsiteRead our in-depth Wise reviewVirgin Money Business Savings Accounts
- Choice of a whole range of instant access, notice & fixed term deposits
- Earn interest from 1.35% up to 5.15% AER
- This gets paid in monthly, quarterly or at the end of term, depending on account
- Start saving with instant access from £1 up to a maximum £2 million
- Notice accounts have no minimum or maximum balance restrictions
- Fixed term accounts require £5,000 to open & can hold up to £25 million
- Choose between standalone savings or accounts that link to your current account
- Range of Virgin business accounts available, with cashback
- Deposits are covered by the FSCS up to £85,000
WebsiteRead our in-depth Virgin Money reviewUnited Trust Bank Business Savings Accounts
- Online digital bank offering the highest interest rate to businesses
- Four notice & eight fixed term savings accounts available
- Savings terms available from 40 day notice to five year fixed bonds
- Earn rates between 4.10% & 5.25% AER, tracking the BoE base rate
- Interest is paid into the account yearly, or end of maturity for the one year saver
- The minimum opening deposit is £5,000 & you can save up to £1 million
- No withdrawals are permitted until the end of maturity for all accounts
- Account management available by phone, email or post
- Fully regulated by the FCA and covered by the FSCS
WebsiteRead our in-depth United Trust Bank reviewNationwide Business Savings Accounts
- Offer an instant access account, 35 day notice & a one year fixed saver
- Earning interest from 2.25% variable to 4.25% AER fixed
- Choice of having interest paid in monthly or yearly
- Minimum balance of £5,000 & maximum balance limit of £10 million apply
- Manage the accounts by email, post or fax
- Extra savings available for those that turnover more than £10 million per year
- You can have multiple accounts up to the value of £10 million, but no more
- Eligible deposits are protected by the FSCS up to £85,000
WebsiteRead our in-depth Nationwide reviewShawbrook Bank Business Savings Accounts
- Provides easy access, notice & fixed savings, five business accounts in total
- Easy access, 45 day, 100 day, one year & two year fixed term savings available
- Interest rates start from 3.76% up to 5.03% AER
- Accounts can be opened with an initial £1,000 deposit & can hold up to £2 million
- No withdrawals allowed except for the easy access account where the minimum withdrawal permitted is £500
- Apply online, by post or by phone Monday to Friday, 9am to 5:30pm
- Manage the accounts 24/7 online
- Business finance & lending available
- Deposits up to £85,000 are protected by the FSCS
WebsiteRead our in-depth Shawbrook Bank reviewNatWest Business Savings Accounts
- Fixed term, notice & instant access savings available
- Interest earned at a rate from 1.46% to 4.25% AER, with agreed rates on fixed term savings
- Paid in on the last day of each month or on maturity
- No minimum or maximum balances apply for the instant access or notice accounts
- While deposits into the fixed rate account have a minimum requirement of £100k
- Client accounts available for single & multiple client businesses
- 24/7 mobile banking with their award-winning app
- A range of business current accounts are available to businesses of all shapes & sizes
- Covered by FSCS for eligible deposits up to £85,000
WebsiteRead our in-depth NatWest reviewMonzo Business Savings Pot
- Digital instant access savings pot attached to award-winning online business current account
- Earn a variable interest rate of 1.60% AER
- Interest is paid monthly & there is no minimum deposit to open
- Make unlimited deposits & withdrawals whenever you need
- There is a maximum balance restriction of £100,000
- Available to businesses with a Monzo current account
- Offering loads of business tools & helpful features
- Manage 24/7 on the app or online
- Eligible deposits are protected by the FSCS, up to £85,000
WebsiteRead our in-depth Monzo reviewLloyds Bank Business Savings Accounts
- Fixed term deposit, notice & instant access savings available
- Earn interest between 1.31% variable & 4.37% fixed AER
- Daily interest calculations, paid monthly or end of term
- Only existing customers can apply for a notice account
- 95 day notice account only for businesses that turnover £3 million or more
- Open with as little as £1 & deposit up to £5 million
- Make unlimited withdrawals on instant access & notice accounts
- 24/7 online & mobile management
- Current accounts for small & large businesses available
- Covered by the FSCS up to £85,000
WebsiteRead our in-depth Lloyds Bank reviewDudley Building Society Business Savings
- Choice of one or two-year fixed term, notice accounts & instant access savings
- Available to incorporated & unincorporated businesses
- Fixed term interest rates from 4.00% to 4.20% AER
- With minimum deposits from £1,000 & maximum balances of up to £1 million
- Notice accounts earn from 3.95% up to 4.10% AER up to £1 million
- The instant access account offers a variable rate of 3.75% AER
- Applications can be made by in person or by post or by phone
- Manage the account by email, phone, post or in-branch
- Eligible deposits up to a total of £85,000 are covered by the FSCS
WebsiteCambridge & Counties Bank Business Savings Accounts
- Choice of a six month, one, two or five year fixed rate bond & 31 day or 95 day notice accounts
- Available to businesses, trusts & charities or credit unions
- Start saving from £10,000
- With a competitive interest rates of 4.05% to 4.80% AER
- Maximum savings investment of £5 million per account (max two accounts)
- Manage your savings by phone, post or conveniently online
- No withdrawals are permitted before account maturity
- Eligible deposits covered with FSCS protection, up to £85,000
- Awarded Best Business Fixed Savings Account Provider in the Business Moneyfacts Awards 2023
WebsiteMetro Bank Business Deposit Accounts
- Offering instant access, fixed deposit & notice accounts for businesses, charities & clients
- Interest rates ranging from a variable 1.20%-3.70% AER fixed
- Open online, by phone or in-store with no appointment
- Start saving from £1 or £5,000, with no upper balance limits
- 24/7 online & mobile banking
- Choice of two business current accounts
- Top rated bank for branch services & customer support
- Regulated bank benefiting from FSCS cover
WebsiteRead our in-depth Metro Bank reviewBarclays Business Savings Accounts
- Choice of instant access, fixed term & client savings
- Accounts have no minimum balance & hold up to £50 million
- Get between 1.51% to 1.96% AER interest on the instant account
- Fixed terms ranging from overnight to a year, rates available on request
- Calculated daily & paid in quarterly or at the end of term
- Manage the accounts in-branch, by phone or 24/7 online
- Multiple business current account choices are available
- Fully regulated bank covered by the FSCS
WebsiteRead our in-depth Barclays reviewHSBC Business Savings Accounts
- Choice of call, notice & fixed accounts
- Kinetic instant access savings offered with Kinetic current account
- Minimum & maximum balance limits vary per account
- Interest rates start from 1.94% AER variable
- Paid in monthly or twice yearly
- Open in-branch, online, by post or by phone
- 24/7 mobile banking with their award-winning app
- Offers multiple current accounts
- Deposits of £85,000 are protected by the FSCS
WebsiteRead our in-depth HSBC reviewHampshire Trust Bank Business Savings Account
- Offer a 95 day business notice account, to both businesses & charities
- Earning an interest rate of 4.50% AER, paid annually
- Invest from £5,000 up to a maximum of £750,000
- Unlimited deposits for the first 14 days of opening
- While no withdrawals are permitted without 95 days of notice
- Applications are only accepted online with 24/7 online management
- Offers corporate deposit solutions for deposits from £1 million
- Authorised & regulated bank protected by the FSCS
- Awarded Best Business Fixed Account Provider six times in a row, in the Business Moneyfacts Awards 2017-2022
WebsiteRoyal Bank of Scotland Business Savings Accounts
- Offering instant access, notice & fixed term savings
- Interest is earned from 1.46% to 4.25% AER, with custom rates on fixed term savings
- Calculated daily & paid in at month end or maturity
- No minimum or maximum balances apply for the instant access or notice accounts
- Deposits into the fixed account have a minimum requirement of £100k
- Single & multiple client management savings accounts available
- 24/7 online & mobile management
- A range of business current accounts are available to businesses of all shapes & sizes
- Deposits up to £85,000 are protected by the FSCS
WebsiteRead our in-depth Royal Bank of Scotland reviewSaffron Building Society Business Savings Accounts
- Choose from their fixed rate or instant access accounts
- Earning interest between 1.20% variable and 4.40% AER
- Interest is calculated daily & paid monthly or annually
- Minimum savings deposits start from £1, where balances don't exceed £2 million
- Available to businesses of all sizes, including not-for-profits
- Can be managed by post, in-branch or 24/7 online
- Friendly customer contact team available Monday to Saturday
- Deposits are protected by the FSCS for a total of £85,000
WebsiteNewcastle Building Society Business Savings Accounts
- Offer online easy access savers & 60 or 90 day notice accounts
- For sole traders, partnerships & limited companies
- Earning interest from 3.60% to 4.10% AER
- With minimum deposits starting from £1 & maximum balance limits of £1 million
- Apply for an account online or visit a branch
- Manage from anywhere with 24/7 online access
- Request advice on your financial planning
- Business deposits covered with FSCS protection
WebsiteBank of Scotland Business Savings Accounts
- Fixed term deposit, notice & instant access savings available
- Offering variable & fixed rates between 1.31% & 4.37% AER
- Interest is paid daily, monthly or end of term
- Notice accounts are only available to existing customers
- 95 day notice account only for businesses that turnover £3 million or more
- Open from £1 & invest up to £5 million maximum
- Unlimited withdrawals are permitted on instant access & notice accounts
- Manage the account 24/7 online
- Offers current accounts for small & large businesses
- Deposits up to £85,000 are FSCS protected
WebsiteRead our in-depth Bank of Scotland reviewThe Co-operative Bank Business Savings Accounts
- Offer a 35 or 95-day notice account & instant access savings
- Variable interest ranges from 1.63% to 2.51% AER
- Calculated daily & paid out twice yearly
- There are no minimum or maximum balance restrictions
- Must have a Co-operative Bank business current account to open
- Multiple current accounts are available
- Notice accounts are only managed by phone while the instant access account is accessed online or by phone
- Protected up to £85,000 for eligible deposits
WebsiteRead our in-depth The Co-operative Bank reviewUnity Trust Bank Business Savings Accounts
- Range of instant access, & fixed term deposit accounts available
- 2.77% AER variable interest is earned on the instant access account
- While the fixed term rates are 2.96% to 5.00% AER, from 30 days to two years
- Interest is compounded each year
- Save from £100,000 on all terms, no minimum balance limit on instant access
- There are no opening fees or charges
- 24/7 online account management
- Three business bank accounts available, suitable for businesses of varying turnover
- The FSCS protects eligible savings deposits up to £85,000
WebsiteRead our in-depth Unity Trust Bank reviewSantander Business Savings
- Offer two instant access accounts & one fixed term
- Savings range from 1.05% to 3.60% AER
- With a reduced rate of 0.40% AER if you make withdrawals (Business Reward Saver)
- Preferential rates for 1|2|3 Business World customers
- Interest calculated daily & applied monthly or annually
- Start saving from £1 up to £5 million, with no limit on the Reward Saver
- Save from anywhere with online & mobile banking
- Fixed rated account is only available to existing customers
- Award-winning business bank accounts available
- Saving deposits up to £85,000 are covered by the FSCS
WebsiteRead our in-depth Santander reviewTSB Business Savings Accounts
- Offer an instant access account or business bonds with three terms
- Variable interest rate of 1.35% AER, or 1.50% on balances over £5,000
- Fixed rates up to 4.50% with 12, 18 & 24 month terms
- Save up to a maximum of £5 million
- Need a TSB business current account to open
- Open online, in-branch or over the phone
- Manage the account 24/7 online
- Offers one current account for new & switching businesses
- FSCS protection on deposits up to £85,000
WebsiteRead our in-depth TSB reviewCumberland Building Society Business Savings Accounts
- Offer two instant access accounts, a 40 day notice & a one year fixed account
- Variable interest rates of 3.05% to 4.20% fixed AER
- Calculated daily & paid annually on 31st March
- The instant access accounts can be opened with £1 or £100, but the notice account requires a £10,000 minimum balance
- All accounts have a maximum balance limit of £1 million
- Current account with two tariff options available
- eSavings exclusive to Cumberland business current account holders
- Access via internet banking, mobile app, phone or in-branch
- Licenced building society with FSCS protection on deposits
WebsiteRead our in-depth Cumberland Building Society reviewCater Allen Private Bank Business Savings Accounts
- Offering a notice account & a fixed term deposit with two terms, 12 or 24 months
- Earn interest from 3.65% up to 4.70% AER, depending on how much you save
- Make an unlimited amount of withdrawals without penalty when 35 days notice is provided
- One withdrawal up to £2,500 can be made without notice once a year if the remaining balance is greater than £5,000
- Can be opened in three to five days without appointment
- Manage it 24/7 online or at your convenience with post & telephone banking
- Offers a business current account that earns 0.05% AER interest on balances over £500,000
- Independent subsidiary of Santander
- FSCS deposit protection up to £85,000 on eligible business deposits
WebsiteRead our in-depth Cater Allen Private Bank reviewClose Brothers Savings Accounts
- Choose from three fixed term accounts, saving from one to two years & a 95 day notice account
- The interest rates vary from 4.50% variable to 5.15% AER fixed
- Only available to registered SMEs - those with less than 250 employees
- Fixed term deposit accounts have a £100,000 minimum deposit
- While the 95 day notice accounts require a £250,000 minimum, the rate is 1.00% AER when below this
- Requires a nominated business account for deposits & interest payments
- Account can be managed by phone or post
- Customer support available weekdays, 9am to 5pm
- Deposits up to £85,000 are covered by the FSCS
WebsiteAllied Irish Bank (GB) Business Deposit Accounts
- Offer an easy access account & fixed term accounts available
- Save for a fixed period of time between three to 24 months for interest rates of 2.75% to 4.00% AER, paid yearly or on maturity
- Demand deposit account offers instant access earning 2.25% AER paid daily
- No maximum balance caps but fixed term accounts require a minimum £5,000 opening deposit
- Corporate deposit account available for investments more than £500,000
- Accounts need to be opened at business centres or by phone
- Can be managed online, by phone or in-person
- Offers business current account & borrowing products
- Eligible deposits are protected up to £85,000, by the FSCS
WebsiteRead our in-depth Allied Irish Bank (GB) reviewDanske Bank Business Investment Accounts
- Fixed term deposit account available, opened with a minimum one-time investment of at least £5,000
- Choice of terms from six months to five years, earning interest up to 4.50% AER, depending on balance. Paid on maturity
- Instant access account available with a £1 balance minimum but no maximum
- Offering a variable interest rate of 1.65% AER, with rates up to 1.90% AER for Enterprise or Enterprise Plus account holders
- 24/7 online & telephone banking
- Businesses can also open current accounts, available to small & large businesses
- Eligible savings deposits are protected by the FSCS up to £85,000
WebsiteRead our in-depth Danske Bank reviewReliance Bank Business Savings Accounts
- Choice of instant access, fixed bonds & notice accounts for businesses or charities
- Interest is earned from 2.15% up to 4.40% AER variable
- This is calculated daily & compounded quarterly
- No minimum balance requirement on instant access account, notice accounts require from £5,000 & bonds from £1,000
- There is a maximum £10 million savings limit
- A 14 day cooling off period applies should you change your mind after opening
- Manage & access your savings with online, mobile or telephone banking
- Reliance are the bank of choice for The Salvation Army
- Eligible deposits up to £85,000 are covered by the FSCS
WebsiteRead our in-depth Reliance Bank reviewKent Reliance Business Savings Account
- Offers an online instant access account with unlimited permitted withdrawals
- Get an interest rate of up to 3.00% AER variable on balances of £1 or more
- This is calculated daily & paid monthly or annually
- Start saving from £1,000, where additional deposits are allowed
- Only available to private limited companies with no more than 3 directors
- Apply online in as little as 10 minutes
- 24/7 online account management
- Customer support is available weekdays by phone, email or post
- FSCS protected, for deposits up to £85,000
WebsiteUnion Bank of India (UK) Business Deposits
- UK subsidiary of one of the largest Indian banks, offering fixed business savings
- With rates from 4.00% to 4.95% gross on GBP & up to 4.80% on USD
- Only fixed term savings available, with terms from one to five years
- The minimum deposit requirements are £1,000 or $5,000, depending on currency
- No withdrawals or top ups are allowed during the selected term
- The maximum balance is £1 million/$1 million
- Complete their application form by post, or taking to a branch to open an account
- Then you can manage in-branch, by post or by email or fax
- Total deposit protection up to £85,000, from the FSCS
WebsiteState Bank of India UK Business Savings Accounts
- Offering instant access & fixed term accounts up to five years
- Get rates between 0.10% & 5.00% fixed AER, plus a 0.50% loyalty bonus on fixed deposits for renewing
- Calculated & paid on the last working day every month or annually
- Interest is only paid on balances over £10,000 (or $100,000 for USD accounts), except for the notice account which has no limits
- Instant access account only available to micro-businesses: those that turnover less than £1.7 million per year
- Unlimited withdrawals permitted for instant access & notice accounts (if prior notice is given)
- Account can be managed in-branch, by post or via online banking
- UK regulated bank with FSCS protection
- Awarded Best Business Fixed Account Provider in the Business Moneyfacts Awards 2024
WebsiteRead our in-depth State Bank of India reviewThe Bank of London Business Savings Accounts
- Choice of easy access, notice & fixed rate accounts for non-regulated & regulated businesses
- Earning competitive interest rates up to 4.90%, applied daily for all types
- Notice account has periods available from 31 to 180 days
- While you can choose fixed terms of 1, 2 or 3 years
- All accounts have a minimum balance limit of £10,000
- Open an account online & start saving in as little as 20 minutes
- Powerful business bank account for day-to-day banking available
- Boast safer banking by not investing or loaning your business money
- Deposits held securely at the Bank of England & FSCS-protected, up to £85,000
WebsiteWhat is the best business savings account?
Here's what we think are the best business savings accounts and what for:
- Best business savings accounts overall: Allica Business Savings Accounts · Rates up to 5.05% AER
- Best easy access: Tide Instant Access Saver · 4.33% AER
- Best notice accounts: United Trust Bank Business Savings Accounts · Rates up to 5.25% AER
- Best fixed term: Allica Business Savings Accounts · Rates up to 5.05% AER
- Best from a digital bank: Cynergy Bank Business Saver · 4.00% AER
- Best from a high street bank: Virgin Business Savings Accounts · Rates up to 5.15% AER
- Best for highest interest: United Trust Bank Business Savings Accounts · Rates up to 5.25% AER
- Best for long term bonds: Cambridge & Counties Business Savings Accounts · Rates up to 4.80% AER
- Best for short term bonds: iFAST Corporate Fixed Term Deposits · Rates up to 4.60% AER
- Best for large businesses: Barclays Business Savings Accounts · Rates up to 1.96% AER
- Best for charities: Unity Trust Bank Business Savings Accounts · Rates up to 5.00% AER
- Best for multiple currencies: Wise Business Interest · 4.66% on GBP, 5.05% on USD, 3.67% on EUR
What is a business savings account?
A business savings account is a type of bank account that is specifically designed to help businesses save money. It is a secure account that earns an interest rate on deposits.
Unlike a current account, which is mainly used for transactions, a business savings account is typically used for long-term savings goals, such as business expansion, investment or even a rainy-day fund.
Who can get a business savings account?
Typically, to be eligible to open a business savings account you must:
- Be a sole trader, partnership or a limited company registered with Companies House
- Be a UK resident with the right to work
- Be 18 or over
- Have a UK-based business
Business savings account rates
You're currently likely to see interest rates vary from 0.10% to 5.25% AER on business savings.
The interest rates you're offered depends on the type of savings account you choose, where fixed deposit accounts tend to offer the best rates, but require your money to be locked away for a longer time, while instant access accounts offer convenience for a lower return.
What are the differences between business savings and business current accounts?
The main difference between business savings accounts and business current accounts is that savings accounts are designed for holding money not for transactions, while a current accounts are for everyday use.
You usually won't earn interest on your balance in a current account and even if you do, these rates will be a lot lower than those offered by a savings account.
Different types of business savings accounts
There are three different types of savings accounts:
- Easy access accounts - these tend to offer unlimited, free and easy access to your money but usually at the expense of a higher interest rate. There are usually low or no minimum deposit requirements to open these.
- Notice accounts - to withdraw money from these you'll need to give notice beforehand. These notice periods tend to be 30, 60, 90, or 120 days. You might get a bit better variable interest rate but you won't have instant access and could be charged to take out without notice.
- Fixed term bonds - these tend to offer the most competitive interest rates that are fixed for terms from overnight to multiple years. A minimum deposit is usually required to open and no further deposits or withdrawals are allowed.
How to choose the best business savings account
There is no go-to business savings account for every single business, as it depends entirely on how much money your business wants to save and how often you need access to your funds.
There are, however, a few factors you can consider when looking for the best option:
- High-interest vs flexibility - the rule of thumb is that the more restrictive the savings account the higher the interest rate. If you need access to your funds often, you may have to pay extra for the flexibility. If you prefer easy access accounts, an instant or notice savings account is most likely best suited to your business savings needs.
- Bonuses - there are both short and long-term bonuses available and you may find that you want to upgrade your account once a bonus expires. This can be a bit of a hassle for some, so a different option would be to consider sticking with long-term bonuses. Just bear in mind that these are not as competitive as the short-term bonuses.
- Access - it is worth being aware of how easy it will be for you to access your savings account. Providers will vary in regard to internet banking, post or phone access, or even a combination of all three. Figure out what is a priority to your business and what works for you best.
- Minimum balance - as mentioned, when it comes to an instant account you will have to maintain a minimum balance. In some cases, you may even have a minimum deposit. Typically the starting balance for an instant access account is £1, for a notice account it’s £100, and for fixed rate bonds it can start from £1,000. Bear in mind that you may also encounter monthly fees for operating your new business savings account.
How are business savings taxed?
Business savings accounts usually present their interest as gross which means that it shows the interest rate before tax is deducted.
Bear in mind that if your savings account doesn’t deduct tax, you will need to do this yourself as part of your annual tax return. This is particularly important for limited companies, but also for sole traders.
How are business deposits protected?
In most cases, eligible business deposits are protected by the Financial Services Compensation Scheme (FSCS). A UK scheme that protects customers' money should their bank or building society go bust.
It is important to know that the FSCS only covers £85,000, or £170,000 for partnerships, per business per bank/building society. So if you want full protection make sure to spread your investments across multiple financial institutes.
Frequently asked questions
It's not uncommon to have questions when looking in to business banking, especially for the first time. These are some of the most relevant questions for business savings accounts:
AER stands for annual equivalent rate. It shows the rate at which interest is paid and compounded per annum.
The current BoE base rate is 5.25%, as of Thursday 9th May 2024, remaining unchanged from the last review. The next decision is due 20th June 2024.
Any bank, building society or credit union authorised by the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA) offers security with the Financial Services Compensation Scheme (FSCS).
All the business savings accounts listed in this guide are covered by the FSCS.
No, businesses can choose to open a business savings account but this is not a legal requirement.
Most businesses should be able to open business savings accounts with online banks, like Allica, high street banks, like Virgin Money and a whole host of building societies.
Yes, businesses can have as many savings accounts as they want, so long as they are eligible.
To get the full benefits of interest paid on a certain amount of money, this money needs to be in a business savings account. You can keep your money in a current account, however interest rates will be a lot lower, or zero, on these.
Business savings accounts can be beneficial as you can save up for major business purchases, help your business expand and grow, as well as provide a financial cushion during financially difficult times.