What is a freelance bank account?

Freelancing has become an interesting career option for many in the UK, and it’s easy to see why. It allows you to work independently, while offering your services across different industries.

Managing your finances efficiently is crucial for sustaining your business. One important thing to consider is whether to have a separate bank account for your freelance work. In this article, we’ll explain what a freelance bank account is, discuss its importance, and explore factors like fees and the application process.

If you’re looking for a simple way to manage your freelance finances alongside your personal spending, check out Revolut Pro — a free account for freelancers, with all the features you need in one app.

While it's not considered a bank account, it works much like one. You’ll get a separate IBAN (international bank account number) to accept payments, and a debit card that lets you earn up to 1% cashback on your business spend. Take payments online, make sales in person, and track your cashflow with in-app analytics tools that give you the full picture — it's all at your fingertips.

What is a freelance bank account?

A freelance bank account is a specialised bank account designed for people who are self-employed. Unlike personal accounts, they're built to meet the needs of people with small-scale businesses — like freelancers, sole traders, and side-hustlers.

Key features of a freelance bank account

Freelance bank accounts generally offer features that simplify money management and bookkeeping for those with solo business ventures:

• A separate space for business funds
  Having a dedicated business account allows you to keep your personal and business finances separate. This simplifies bookkeeping and helps you maintain clear financial records for tax purposes.
• Enhanced features for businesses
  Many providers offer special features designed for business accounts, such as the ability to send invoices directly or tools to track expenses and income more effectively.
• Access to business financial products
  Freelance bank accounts can provide access to business loans, overdrafts, and credit options that might not be available with personal accounts.

📊 Manage your business expenses with Revolut Pro.

You'll get access to in-app analytics and invoicing tools, as well as a debit card with up to 1% cashback on eligible transactions.

You'll also be able to give your customers several payment methods to choose from. Generate custom links and QR codes for online payments, or make sales in person with Revolut Reader or Tap to Pay on iPhone (processing fees apply).

Do I need a separate bank account as a freelancer?

You're not legally required to have a separate bank account for your business. But, there are many benefits to opening one:

• Simpler money management
  With a dedicated freelance bank account, managing your finances becomes straightforward. You can track business expenses and incoming payments more easily, which gives you a clearer picture of your business's financial health.
• Easier tax filing
  When it’s time to file your taxes, having a separate account simplifies the process. You’ll be able to quickly gather all your business transactions without mixing in personal expenses. This can reduce errors and prevent issues with HM Revenue and Customs (HMRC).
• Better budgeting and planning
  Maintaining a business hinges on effective budgeting and planning. Having a separate account allows you to set aside funds for different purposes — like taxes, operating expenses, and savings. This separation makes it easier to make financial decisions down the line.
• Professionalism
  Clients tend to perceive freelancers with dedicated business accounts as more professional. It can enhance your overall brand image and instil trust in potential clients.
• Legal protection
  While having a separate bank account doesn't create a separate legal entity for your freelance work, it may provide a layer of protection for you in case of disputes or audits. It helps clarify which funds belong to your business and are subject to business obligations.

Are there fees associated with a freelance bank account?

Freelance bank accounts can come with various fees, depending on the bank and the account type you choose. Understanding these fees is important for maintaining a sustainable budget. 

Here's a breakdown of some common fees associated with freelance bank accounts in the UK:

• Monthly maintenance fees
  Some banks charge a monthly fee for maintaining a business account. This fee can vary widely from one bank to another, so it's worth comparing your options before choosing a provider.
• Transaction fees
  Depending on the bank, you may pay fees for each transaction made through your account. This can include payments you receive or transfers you make. Some accounts offer a certain number of free transactions, while others may charge after you hit a specified limit.
• ATM withdrawal fees
  If you withdraw cash often, consider ATM fees when choosing an account. While many business accounts offer free withdrawals from their ATMs, you may have to pay an extra fee for using ATMs from other banks.
• Additional services
  If you need extra services — like overdraft protection or foreign currency transactions — look out for any associated fees. Many banks provide these services, but they may charge extra for them.
• Penalty fees
  You may have to pay fees for making late payments or going over your overdraft limit. Make sure you understand the bank's policies on penalties to avoid unnecessary costs.

Some banks now offer fee-free options for start-up freelancers, especially as a limited introductory offer. Always read the fine print and consider your business’s needs before you choose an account.

✅ Open a free Revolut Pro account — with no opening or monthly maintenance fees. You'll be able to track your spend, create invoices, and earn cashback on eligible business purchases made with your debit card.

You can also take payments online via custom links and QR codes, starting from 1 % + €0.20 per transaction — or make in-person sales with Revolut Reader or Tap to Pay on iPhone, from 1.5% per payment.

How long does it take to open a freelance bank account?

Opening a freelance bank account typically doesn’t take long. But, the exact timeframe can vary depending on the bank, your personal circumstances, and the documents required. Here’s a general overview of the steps involved.

1. Prepare your documents

Before you open an account, make sure you have all the necessary documents ready. Most banks will ask for:

• proof of identity (such as a passport or driving licence)
• proof of address (like utility bills or bank statements)
• business-related documents like registration certificates (if applicable)
• details regarding your business activities

Having all these documents prepared in advance can speed up the application process.

2. Fill out your application

Many banks allow you to apply online, which is often quicker and more convenient than applying at a local branch. The application can take anywhere from a few minutes to over an hour, depending on the bank's online platform.

3. Wait for approval

Once you've submitted your application, the bank will run a credit check and verify your business information. This usually takes 1 to 5 business days.

4. Activate your account

After your application is approved, you’ll receive your account details. You’ll usually be able to activate your account the same day. If additional verification is needed, this could take longer.

🛜 Create your Revolut Pro account online.

Setting up Revolut Pro is fast and simple. Just download the app, sign up for Revolut, and enter your business description. You'll get a notification when routine checks are completed, usually within an hour. We may ask for more details to better understand the type of business you run.

Sort out your freelance finances with Revolut Pro

Keep your work-life balance in check — literally, with a 360° view of your personal and freelance finances in one app. Just download Revolut and set up your Revolut Pro account at no extra cost.

You’ll get a different account number for your Revolut Pro account, so you can track your business earnings and expenses separately. Then switch to your personal account balance in a tap.

Give your customers their choice of online payment methods, from custom links to QR codes, and make in-person sales with Revolut Reader or Tap to Pay on iPhone.

You’ll also earn up to 1% cashback on your business expenses when you use your Pro card — and increase your cashback rate as you sell more.

This is freelance freedom. See how Revolut Pro can help you level up your business.