The pitfalls of using a personal bank account for your Limited Company#AskAMS

Can I save on bank charges by using my personal bank account for my Limited Company?

Oh no! You are causing more problems than you are solving. You and your Company are separate legal entities and you must keep your finances separate. There are bookkeeping complications, and huge tax issues.

If your Company money isn’t in a Company account, HMRC will assume all your business funds were withdrawn and loaned to you. They will charge you extra income tax and National Insurance on this ‘interest free’ loan.

If you keep these funds in your own account over 9 months past your Company year-end date, then you (or rather, your company) will have to pay 32.5% tax on these monies (recoverable ONLY after repaying the ‘loan’). This would be due on top of the annual Corporation Tax bill. So the answer is no – you would not save on bank charges!