[Paul Clapham]

I have posted some info on another forum today about Business banking if you run a Ltd company.

Always have a separate and personal bank account from your Business account , and If you have Business Loans / Overdrafts  , with your Business bank , don't have your (or your children or Wife's)  Mortgage, Pension , Savings, ISA , or any other form of finance with your Business Bank or any other Bank in its Group.

The reason being, if your  business go bust , even though you are a Ltd company, and you owe them any outstanding monies they will , can and have done, taken the monies owed to them, from  all the other accounts within their banking group, even though they are not part of your business ! However they cannot touch it if its in another Banking Group.

I am talking from experience here, if you have Business Loans / Overdrafts do not use your Business Bank for anything else other than  depositing takings , paying suppliers, VAT , wages and any other Business payments only.

Keep CLEAR BLUE WATER between  Your Business money and your Personal Finance.

 

[heritagecleaning]

I don't doubt this has happened, however from the information you have given the bank would be acting illegally, since the Ltd company and any individual would have a completely different legal personality.

What has probably happened in these cases is that the business loans were secured with directors' personal guarantees, so when the loans were called in the directors remained liable for the sums outstanding.

I could be wrong though - have been before 

[Kinver_Clean]

One of my customers ran a nightclub which ran short of money so the bank took money from his wifes business account.
He closed the account and ran the club cash only which was fine for me but the brewery did not like it much.

[Steven Butler]

Is there any benefit in been a ltd company in the early days with a low turnover? Or is it something more suited to established businesses.

[PaulKing]

its a firewall between you and the business, say you or a member of staff kills someone by dropping a portable machine down some stairs, of tripping some hospital electrics, or sucking up some expensive item,  and then by some chance your insurance company holds you responsible and refuses to pay the claim and it falls to the business to pay , then the most you will be liable for is your initial investment in the company ( often £1 or £100 ) which you already invested.

Best way to think of a ltd company is to consider it a separate individual, it has its own bank account, it can be taken to court and also take others to court. it is responsible for its action etc. As long as you play everything fair you have less chance of losing everything if the sky should come falling down. Thats said we've never needed it and having audited accounts and submitting returns does cost more, but the peace of mind is nice. Also your employed by the limited company So applying for personal credit is a heck of a lot easier. But banks don't like to lend to the company without a personal assurance.

[Hilton]

The banks demand personal guarantee if your limited unless your business is cash rich in which case why would you need a loan.....
And, it's up to you once the loan is finished to remove the guarantee otherwise it stays with your business.Just another one of the scams the banks pull..

[Paul Clapham]

That's another good point Hilton , if your company has had a bank loan , and its paid off get the guarantee removed and have it writing that it has been removed.

[Ian Gourlay]

I don't doubt this has happened, however from the information you have given the bank would be acting illegally, since the Ltd company and any individual would have a completely different legal personality.

What has probably happened in these cases is that the business loans were secured with directors' personal guarantees, so when the loans were called in the directors remained liable for the sums outstanding.

I could be wrong though - have been before 

Think you might be I had to clear wifes overdraft  with Lloyds as I was with Lloyds , even though wife had cash elsewhere