Business Banking

Setting up and using banking systems that support your business

Getting your financial foundations right from the start makes every part of the business journey easier. When you have a straightforward, well-managed banking arrangement for your business, it will be easier for you stay compliant with the Australian Taxation Office, build credibility with banks and funders, and build trust with customers who expect accurate invoices and fair pricing.

Having a business account can create structure for how money flows through your business, helping you understand your finances, meet obligations, and make more informed decisions as your business grows. .

What to look for in a business bank account

Many banks allow you to open a business account. When choosing a business bank account, you should:

• Look for transparent or low fees to avoid unexpected costs, and check if the bank integrates with bookkeeping or accounting software for easier financial management.
• Check if it has reliable online and mobile banking services for managing your finances on the go.

Indigenous-focused banking support

There are a few Australian banks that offer dedicated services and engagement strategies for Aboriginal and Torres Strait Islander businesses. These programs can provide culturally informed advice, specialist support, and tailored products. If you’re considering opening a business account, you can contact one of these organisations to help you.

ANZ’s First Nations Strategy

Fuelling the Fire is ANZ’s First Nations Strategy to help grow the First Nations economy, including financial inclusion, wellbeing and cultural intelligence 

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Westpac First Nations Hub

Indigenous Business Banking to back your deadly business from start-ups to growth and expansion 

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Indigenous Business Banking NAB

Access to Indigenous Banking Experts, Small business hubs, and banking solutions to support your business. 

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Indigenous Business Banking CommBank

A range of solutions to assist Indigenous Business owners in accelerating or simplifying their operations 

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While these programs can offer additional assistance with setting up banking, it is still important to compare fees, services, and suitability for your specific business needs.

Using your business bank account properly

When opening a business account, it’s important to use it consistently to reap the full benefits. This means organising your finances to support the growth and management of your business.

One good practice is to ensure that all income generated by your business is deposited directly into this account. Similarly, all business expenses should be paid from the same account. This clear separation of finances helps you maintain a clearer picture of your business’s financial health.

It’s also essential to avoid mixing personal spending with your business account. Keeping personal and business finances separate makes it easier to manage your books and reduces the risk of errors or disputes in the future. Additionally, try to minimise cash withdrawals from the business account whenever possible.

By following these practices, you’ll simplify your financial management and ensure compliance with tax regulations, ultimately supporting the smooth operation of your business.

Using multiple accounts intentionally

As businesses grow, many owners choose to have more than one account, each linked to the business and to the others. It helps them streamline budgeting, tracking and complying with Tax and GST regulations.

Often, a business will have:

An income account: This account is dedicated to income for the business, the one that is printed on invoices and that clients and customers pay into. Keeping your business income separate makes it easier to track your earnings. This account should encompass all forms of income, including sales, services rendered, and investments.

Operating Expenses Account: This account is used for all day-to-day business expenses necessary to keep the business operating efficiently. This includes costs such as utilities, rent, salaries, supplies, and other recurring payments, such as subscriptions your business has. By using a dedicated account for operating expenses, you can easily track your spending and identify cost-cutting opportunities if necessary. It will also help you with budgeting by allowing you to designate funds more effectively based on historical data.

GST Collected Account: If you operate a business that is registered for GST, it makes business sense to open a separate account to hold these funds. This account will help you stay organised and ensure you set aside the correct amount to remit to the tax authorities. You can transfer the 10% GST you earn on sales straight into the account, so when it’s time to pay the ATO, you already have the funds and know exactly how much you need to pay. Keeping GST funds separate reduces the risk of spending them on operating costs and simplifies tax filing and payment.

Savings Account for Large Future Expenses

This one is optional, but some businesses use savings accounts to set aside funds for high future costs, such as equipment purchases or planned expansions. This account allows you to build a reserve that provides a savings buffer for significant expenses, enabling better financial planning and mitigating the impact of unexpected costs.

By organising your finances with one or more of these accounts, you can improve your financial management, maintain compliance with tax laws, and better prepare for future expenses. Having a well-planned approach allows you to focus more on growing your business rather than worrying about financial mismanagement. Many institutions require these bank statements for grants, loans, contracts, and insurance, so having clearly organised records can significantly enhance your funding and partnership opportunities.

Official guidance on setting up a business bank account is available through Banking records – business | Australian Taxation Office, which outlines what banking records you’re expected to have and provides tips for handling banking records.