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The Cons of Avoiding Business Banking

December 29, 2018 Comments Off on The Cons of Avoiding Business Banking

When you are just starting out a business, it may be your goal to keep the business small in the beginning, slowly building up your success until you have achieved the level that you desire. Keeping the business small and under the radar may also mean choosing not to open a business banking account, rather using your own personal checking account for the time being. This method is used often, but it is not necessarily the smartest decision you can make when trying to build up a business. There are several things that you should consider before you decide to stay strictly with your personal banking account; taxes, professionalism and more taxes.

Keeping both your personal banking and your company banking together can cause mass confusion, especially during tax season. Keeping personal and professional spending and costs separate can be quite a hassle. You are required by law to report all of your business spending in an accurate and precise way. Having both your personal and company banking all tied up together can cause quite a bit of hassle if you are not diligent, carefully recording and keeping separate all of your spending. Keeping your accounts together can also mean that you may miss some valuable tax deductions that you are entitled to. Having messy records makes it very difficult for yourself or your accountant to find all of the prudent deductions that can help your business.

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