Please help - bank won't let me run cleaning business from personal account (and other queries)

[Lowla]

As the title says really.

I have a current personal account with a bank. However, i want to seperate my 'work/business' money from my personal money to make bookkeeping easier.

So i went to three different banks today, explaining my predicament, and they all said i would need a business account!

I literally only started my 'business' 3 days ago. I'm currently just building my website etc, i don't even have a customer yet! I explained that legally, soe traders are able to operate from a personal account. However the banks said doing this would breach their own terms and conditions.

I told them i'm not willing to set up a business account as the charges will probably be more than any income i might make.

I really do need an account though to deposit my capital so i can start purchasing cleaning materials etc, so i went to a fourth bank today and just opened another current/personal account, not telling them i plan on using it for my tiny company.

Basically, I'll be getting paid cash, So i all i want to do is be able to deposit these payments into an account, and use the same account to purchase cleaning supplies etc.

I don't expect to get much income, and least of all make a significant profit for some time.

So my question from all this waffle is what do all you self employed cleaners/ironers etc do? Do you all have business accounts or do you use your personal account?

The reason i really, really need to seperate business money from personal money is because i'll have to visit the council office frequently with my books in order to receive housing benefit. So i have to make it simple.

OTHER QUESTIONS:

I've taken out public and product liabilty insurance. Is this all i need? (i'm more of a domestic assistant than a cleaner so i do all sorts of domestic things such as cleaning, laundry, running errands etc). Also i don't understand the 'excess thing'. It says there's £250 excess. What does this mean? Say i break an ornament in a customers home that costs £200. How much will i have to pay of that myself?

Bookeeping. I've really tried to figure this out and i can't. Can someone just give me headings (and a definition for each one) that i'll need to put on my spreadsheet/cash book.

As far as i know i have to keep a record of what customers pay me and what expenses i have. What am i missing?

Also, is it okay to ask customers to pay me cash? How would i gain prooof of payment though? Would i write two receipts, get them to sign it, and we each keep a copy?

Thank you for any replies. I'm so confused and i'm just really eager to press on and make a go of this.

You don't need product liability insurance, you are not manufacturing anything.

£250 excess means you will have to pay for that ornament. If the ornament cost £400 to replace you would only have to pay £250.

Bookkeeping: income, cleaning materials, travel, admin. That should do until you start employing people.

Yes it is OK (and totally normal) to be paid in cash. Get a duplicate receipt book like this one.

If you explain what you want to do to a bank they will try and sell you a business bank account and a whole lot of other things you don't need/can't afford. Solution: don't explain what you want to do. Just use your own account until the bank realise what is going on - and then tell them you will just close the account. In the meantime, open an account with another bank. If you show a benefits assessor a bank account with no income they are going to ask where your income is coming from and ask to see that account anyway.

Thank you so much MrAnchovy!

You've really simplified things for me. You're a star.

No Self Employed person [including myself) i know has a Business account, they charge you a fortune. We all do exactly what you have done.

Rather then write 'receipts', you Invoice customers with date, the name and address you work under, their name/address.. Then details of service (hours worked etc) with total due and if they pay then and there, paid with thanks and you sign at the bottom. They keep the original, you keep the duplicate for your records.

Remember to keep your receipts for everything, i keep forgetting even after 3 years!

Have you tried First Direct? I do a direct selling business and they were fine with me setting up a regular account for business use. I was an existing customer, but I did tell them what it was for.

I've been self employed for 11 years and never had a business account.I invoice my customers with a receipt book and some pay cash,some cheque and some directly into my account.I use two accounts in two different banks and have never had an issue at all with them.

Good luck with your business.

Another one who was self-employed for several years without a business account. Mostly paid in cheques or cash, I had a spreadsheet accounting system set up so I didn't keep the money separate. All costs were input into the spreadsheet, all receipts kept, all moneys earnt put into the spreadsheet as well.

This worked well for ~8years until I ceased trading because I was about to emigrate. The bank never picked up on it, never said anything, never had a problem, despite me cashing several cheques at a time for roughly the same amount each cheque.
Mind you, I did have other money going into the account from my PAYE job as well, don't know if that made a difference!

DH and I used to run both our businesses through our bank account
only got business accounts once we went Ltd - and then got the FSB Co op free one and the Santander free one ...

I have a limited company with a business account and don't pay for it. As a start-up you should be able to find free business banking for a while at least, surely? Natwest do 2 years free banking for start ups.

I've found it's really hard to get a personal account for business use. Once you tell them it's for business they refuse. I even got as far as getting cards, cheque books and everything from first direct, it was only once I was on the phone registering and activating everything they asked the question 'will this be used for business'. I should have kept schtum!
Eventually I got a business account with Barclays. It is free for the first year (or two, can't remember) and is working fine - you just have to dodge all the 'products' they try and sell you (like online accounting packages, Barclaycard and the like). When it gets to having to pay for the account, I'll probably transfer it to another bank.
The reason they try and make you have a business account is so they can charge you (eventually) and sell you stuff. End of.