Moving from hobby to Business

[Callidus]

Hi all,

I currently use personal bank accounts to withdraw all funds from PayPal. I obviously, as do many other people, have a lot of personal bank accounts that are all 'cash card' accounts.

My hobby of online selling is going to be taken into a business and therefore I have some questions:

1. I cannot use all these personal accounts as there will be too many to tie up for accounts purposes PLUS they shouldn't be used for business, only business accounts should.... or am I wrong?

2. Do I close all of these accounts and open business accounts?

Slightly unsure of the procedure here and not something I thought of beforehand.

Any advice is appreciated.

Thanks

[Dazzler87]

If your a sole trader then it's fine to use the accounts you have for your business needs, if your a LTD company you must have a business account.

[rsot]

If it's going to fulltime business level, wise move to register it and get business accounts going...and do taxes, etc. like any normal business.

Dont need to close the personal accounts

[Callidus]

Yes I understand that, I am just curious as I am not a 'normal' business currently but will be when I register as a sole trader.

As a sole trade can I just use the personal accounts then?

If I become a LTD company I need to shut the personal accounts and open all business accounts?

[bigbill]

"If I become a LTD company I need to shut the personal accounts and open all business accounts?"

No you don't, although all funds need to reach the LTD business account. Eg, withdraw £1k from EB 1 to Personal Bank Account 1 - forward that £1k to your LTD business account and use all PP records for your books.

Might be best speaking to an accountant...

[Callidus]

I have been speaking to one but wasn't sure if mentioning I am running tens of personal accounts will be the best opening sentence I could come out with, with the accountant not understanding stealth...

[NoneOther]

Be very careful what you 'explain' to an accountant

[Callidus]

Originally Posted by NoneOther

Be very careful what you 'explain' to an accountant

Can you shed any light on that?

[rsot]

Originally Posted by hdavey10

Can you shed any light on that?

No need to go into details with him about stealth identity and such

"This is my business account and this is my income into my business account". I would say "this comes from this ebay and that comes from that ebay". All income goes through business bank account, pay tax on all income. Only one thing surer than taxes.