Is my business savings account protected by the FSCS?

Yes, if your money is held with a UK-authorised bank, building society or credit union, your business savings are usually protected by the Financial Services Compensation Scheme (FSCS). Up to £120,000 per eligible business, per banking group is protected if the provider goes bust. Sole traders: your personal and business savings with the same bank count toward one £120,000 limit. Limited companies or LLPs: your business is a separate legal entity, so it can have its own £120,000 protection in addition to your personal cover. It's important to check that your provider is FSCS-authorised, and it's often a good idea to consider spreading larger balances across different providers to stay fully protected.

How much is the minimum balance to open a business savings account?

The minimum balance to open a business savings account will vary depending on the type of account you wish to open. For example, an instant access could be opened with as little as £1 but a fixed-term account might need a minimum deposit of £1,000. It’s always important to check the terms and conditions for each provider.

Do you pay tax on UK business savings accounts?

Yes. Any interest your business earns on a UK savings account must be declared on your annual tax return. Business savings accounts pay interest as gross, so the advertised rate does not include tax deductions.

Are there any restrictions to opening a business savings account?

Yes, some business savings accounts are only available to certain business types. For example, one type of account may only be eligible for a limited company or a sole trader, but not for a charity. You can also have more than one business savings account if you wish. Just bear in mind that the more accounts you have, the more admin there might be in terms of opening and maintaining them. And depending on the amount of spare money you have, you might not make the most amount in interest if you split your funds between several accounts. Also, if your business is a limited company, you cannot use a personal savings account as a business account, because the business is a separate legal entity. But you can if you're a sole trader, as your business and personal finances are considered one and the same.

What information do I need to provide to open a business savings account?

The exact requirements vary between providers, but in general, you’ll need to prove your business is legitimate and supply identification for both yourself and the business. Here’s what you’ll typically need to provide when opening a business savings account in the UK: For all businesses: Proof of ID and address for all named individuals on the account (e.g. passport, driving licence, utility bill) Proof of business address Business bank account details (some providers only accept applications from existing business current account holders) Details about the nature of your business and its activity For sole traders and freelancers: Proof of trading status (e.g. HMRC registration or UTR (Unique Taxpayer Reference)) Business name (if trading under a different name) Estimated annual turnover (some accounts have a minimum or maximum turnover requirement) For limited companies and partnerships: Certificate of incorporation (Ltd companies only) Companies House registration number Details of all directors, partners, or shareholders Partnership agreement (if applicable) Other potential requirements: A minimum deposit. Some providers require an initial deposit of £1,000 or more Your expected annual turnover Tax residency status for all named individuals (for regulatory checks) Before you apply, it’s worth checking the provider’s eligibility criteria carefully to make sure your business qualifies.

Are the limits on how much I can withdraw and deposit?

Most UK business savings accounts have a maximum deposit limit, but this amount will vary by provider. Some accounts allow large deposits, while others cap the balance eligible for interest. Check your account’s terms before depositing large sums to ensure your funds are fully covered and earning interest. Many business savings accounts also have withdrawal restrictions. For instance, fixed-term savings accounts typically don't allow withdrawals before the end of the term without incurring a penalty. Instant or easy access accounts tend to offer more flexibility, though you may still have to wait a few days for the money to be transferred.

How long will it take to open a business savings account?

Opening a business savings account typically doesn’t take long, as long as you have all the required information ready. The process varies by provider, with some being faster than others. However, you can generally expect your account to be set up within a week or less.

Can I link my business savings account to a business current account?

Yes, you can typically link a business savings account to your business current account. Doing this will allow you to transfer funds easily between the two accounts, improving cash flow management and simplifying savings alongside daily business operations. It is worth checking with your provider for specific linking options and terms to ensure a smooth connection.

Can I manage my business savings account online or via a mobile app?

Most business savings accounts can be managed online or through a mobile app. This allows you to check balances, make transfers, and monitor interest earned from your computer or smartphone. Features may vary by provider, however, so it’s worth checking what digital tools are included before opening an account.

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Business savings accounts

Business savings accounts

Grow your business savings. See accounts offering rates up to 4.38%

Find the best business savings account to keep your money safe while earning interest

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Explore a variety of high-paying business savings accounts from trusted UK providers

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Our best business savings accounts - May 2026

At a glance Top rates today Do I need one?How to choose Pros and cons

We update our best UK business savings rates daily and provide a detailed breakdown of the different account types available, from instant access to fixed-term, so you can compare your options and find the right fit for your business.

Business savings accounts at a glance

What types are available?

The main options are easy access accounts (withdraw anytime, variable rate), notice accounts (give 30-180 days’ notice for a higher rate), and fixed-rate bonds (lock money away for 1-5 years for the best rates).

What rates can I get?

Rates depend on account type and how long you can tie up your money. Fixed-rate bonds typically pay the most, followed by notice accounts, with easy access offering lower but more flexible returns. Use the AER to compare accounts on equal terms.

Who can open one?

Most providers accept UK-registered businesses including sole traders, partnerships, and limited companies. Some accounts have minimum turnover or trading-history requirements, or are restricted to specific business types, so check eligibility before applying.

What is a business savings account?

A business savings account is specifically designed for businesses to earn interest on their savings. Sole traders, partnerships, and limited companies can all open one, typically using it to set aside cash for tax bills, emergencies, or future investment. Any interest earned counts as business income and is taxable, so it's worth factoring into your accounting.

Do I need a business savings account?

A business savings account can help your finances stay organised, protect your cash, and make the most of surplus funds.

Build a financial cushion

Set aside extra funds to cover unexpected costs, seasonal slowdowns, or sudden expenses.

Improve cash flow management

Keep savings separate from daily spending to better track your money and stay financially organised.

Prepare for tax and future expenses

Have money ready for HMRC payments, upcoming bills, or planned investments in your business.

Earn more on idle cash

Make surplus funds work harder with higher interest than a current account, with FSCS protection on eligible deposits.

Find the savings account that suits your business goals

The right business savings account depends on how and when you’ll need access to your money. Here’s how different types of accounts can help businesses like yours:

Flexible day-to-day access

If you want to earn interest but may need your cash quickly, an instant or easy access account is ideal. Perfect for businesses that handle seasonal sales or frequent expenses, as you can deposit or withdraw funds when needed.

Planning for short-term projects

Notice accounts suit businesses that can plan ahead for withdrawals. By giving notice before taking money out, you can often earn slightly higher interest than an instant access account, which can be ideal when managing funds for upcoming projects or supplier payments.

Longer-term savings goals

Fixed-term accounts work best if you can lock away funds for a set period, such as six months to five years. These accounts usually offer the highest interest rates and are great for businesses saving for major investments or building a longer-term financial cushion.

What to check before you open an account

1. How easily you can access your business savings

Make sure you can get to your money when you need it. Some business savings accounts allow instant withdrawals, while others require notice or lock funds away for a fixed term.

2. Minimum balance requirements

Some accounts require a minimum opening deposit or ongoing balance. Check you can meet these conditions, as falling below them could mean fees or reduced interest.

3. Business savings rates and flexibility

A higher rate can come with restrictions. Think about whether locking money away for months or years is worth the extra interest compared with easier access.

4. Protection and provider reputation

Most UK business savings accounts are covered by the Financial Services Compensation Scheme (FSCS), which protects eligible deposits up to £120,000 if a provider goes bust. If you hold more than this amount, consider spreading your savings across multiple accounts to stay fully protected.

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What 2026 savings rates mean for your business

Following the Bank of England base rate cut to 3.75% in December 2025, business savings rates have generally fallen, although some fixed-term accounts still offer returns of around 4.1%.

At the start of 2026, markets expected multiple rate cuts over the year, but that outlook has shifted. Rising energy costs and persistent inflation mean many economists now expect the Bank of England to raise interest rates, or at least keep them higher for longer, rather than cut them.

For businesses holding surplus cash, rising rates could improve returns. With the economic and geopolitical landscape changing quickly, it’s important to monitor rates and review your savings strategy regularly, as what’s competitive today may shift in the coming weeks.

The next base rate decision is due on Thursday 18 June.

The percentage of SMEs that plan to increase cash reserves in 2026^[1]

34%

Rates are subject to change. We recommend double-checking the provider's site for the latest figures before applying for an account.

Pros and cons of business savings accounts

Pros

Earn interest on surplus cash from your business current account(s): Move extra funds out of your business current account(s) and earn interest instead of leaving money sitting idle.

Typically offer higher rates than business current accounts: Business savings accounts are designed to pay interest, so rates are usually better than current accounts.

Range of access options: Choose between easy access or fixed-term accounts, depending on how often you need your money.

Helps with budgeting and cash management: Separating savings can make it easier to plan for tax bills or future expenses.

Cons

May need a minimum balance for top rates: Some accounts only pay the best rates if you keep a certain amount deposited.

Interest is usually taxable: Any interest earned typically counts as business income and may be taxed.

Rates can change: Variable rates can go up or down over time, affecting your returns.

“Think of a business savings account as part of your growth strategy. Building reserves can give you the breathing room to invest in opportunities, weather quiet months, or upgrade equipment without scrambling for credit.”

Joe Phelan

SME Editor

Business savings account FAQs

Learn more about business savings accounts

Find out more about how business savings accounts work with our in-depth guides.

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Business savings accounts explained

The gap between entry-level business rates and specialist savings products has widened

The business savings audit: is your cash working as hard as it could be?

The benefits of a business savings account

How business savings accounts can help SMEs to grow

Find more guides here

About the author

Joe Phelan

Joe joined the money.co.uk team in 2024, where he helps small business owners navigate the often confusing world of business finance. His role is to cut through the jargon and create clear, actionable content that empowers entrepreneurs to make confident financial decisions.