Best Free Business Bank Accounts for Companies and Sole Traders

Keeping your business money separate from your personal finances is one of the most important steps any entrepreneur can take. It makes tax time easier, keeps your records clean, and gives you a clear view of how your business is actually performing.

The good news? You do not need to pay a monthly fee to get a solid business account. A growing number of UK providers offer free or pay-as-you-go plans that cover the essentials — and some go well beyond them, bundling invoicing, VAT filing, and expense management into the same account.

This guide compares four of the strongest options available in 2026: ANNA Money, Monzo, Wallester, and Wise. Each suits a different type of business, so we have broken down exactly what you get, what you pay, and who each one is right for.

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Why a Free Business Bank Account Makes Sense

Keeping your business money separate from your personal finances is one of the most important steps any entrepreneur can take. It makes tax time easier, keeps your records clean, and gives you a clear view of how your business is actually performing.

The good news? You do not need to pay a monthly fee to get a solid business account. A growing number of UK providers offer free or pay-as-you-go plans that cover the essentials — and some go well beyond them, bundling invoicing, VAT filing, and expense management into the same account.

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Quick Comparison: At a Glance

Use the table below to see how each provider stacks up on the features that matter most to small businesses and sole traders.

Note: ANNA Money and Wise are e-money institutions, not fully authorised banks. Funds may be held in safeguarded accounts rather than being covered by FSCS protection. Monzo is a fully authorised UK bank with FSCS protection up to £120,000 per eligible depositor. Always check the provider’s current terms before opening an account.

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1. ANNA Money — Best All-in-One Business Account

What Makes ANNA Stand Out

ANNA stands for Absolutely No Nonsense Admin — and it lives up to the name. Beyond basic banking, it is one of the few business accounts in the UK that genuinely tackles tax compliance from inside the app.

The built-in Auto Accountant handles bookkeeping automatically. It categorises transactions as they happen, keeps a running Corporation Tax estimate, and files your VAT returns directly to HMRC. For limited companies, it prepares and submits the CT600 and Annual Accounts. For sole traders, it handles Making Tax Digital for Income Tax Self Assessment (MTD for ITSA), which becomes mandatory for those earning over £50,000 from April 2026.

Invoicing is equally capable. You can create a professional invoice from the app chat in seconds, share a unique payment link with clients, and ANNA will chase overdue invoices automatically. Payments typically land in your account within 15 minutes to an hour.

Banking Features

• ANNA Mastercard debit card — physical and virtual
• Unique payment link and QR code for getting paid
• Money pots to set aside funds for VAT, tax, or payroll
• Direct Debits and standing orders
• Open Banking connections to view other bank accounts
• Cashback of up to 40% on purchases from selected partners
• Multiple director or co-director access for limited companies
• Loans available for eligible businesses

Tax and Accounting Features

• Making Tax Digital (MTD) for VAT — built in and HMRC recognised
• MTD for Income Tax Self Assessment — free for 2025/26 (limited offer)
• Corporation Tax filing (CT600) and Annual Accounts directly to HMRC
• Automatic receipt capture and categorisation
• Bookkeeping Score to keep records tidy year-round
• Salary and dividends calculator to optimise director pay
• Payroll and PAYE management
• Xero and QuickBooks integration

Opening an Account

You can open an ANNA account in under 10 minutes. Enter your email, download the app, answer a few questions about your business, and your account details are ready the same day. No credit check is carried out, so applying will not affect your credit score.

ANNA is suitable for most types of UK businesses — sole traders, limited companies, startups, and freelancers — with no minimum turnover requirement. Certain business types such as cryptocurrency and gambling are not supported.

Regulatory Information

ANNA is operated by Absolutely No Nonsense Admin Ltd, an Electronic Money Institution (EMI) authorised by the FCA under the Electronic Money Regulations 2011, Firm Reference Number 900594. Cards are issued by PayrNet Limited. Funds in your ANNA account are safeguarded in accordance with the Electronic Money Regulations but are not protected by the Financial Services Compensation Scheme (FSCS).

ANNA’s savings business bank accounts are provided by Griffin Bank Ltd, which is FCA and PRA authorised. Deposits in those accounts are eligible for FSCS protection up to £120,000 per depositor.

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2. Monzo — Best for Growing Businesses

What Makes Monzo Stand Out

Monzo is the only provider in this guide that is a fully authorised UK bank — regulated by both the Financial Conduct Authority and the Prudential Regulation Authority. That means your eligible deposits are protected by the Financial Services Compensation Scheme (FSCS) up to £120,000, which provides a level of security that e-money accounts simply cannot match.

More than 800,000 businesses bank with Monzo. In an independent service quality survey published in February 2026, Monzo ranked first for overall service quality, with 85% of customers saying they would recommend it to other businesses.

The free Lite plan gives you a fully functional business account with standard banking features. If you need more — like a tax pot that automatically sets aside a percentage of income, or access to expense cards for team members — that comes on the Pro (£9/month) or Team (£25/month) plans.

Banking Features

• UK sort code and account number
• Mastercard business debit card
• Accept payments by card via Monzo payment terminal, payment links, QR codes, or invoices
• Real-time transaction notifications
• Interest-earning savings pots (up to 1.30% AER variable)
• Overdrafts and business loans for eligible accounts
• 24/7 in-app customer support with option to call or email
• Mobile and web banking

Accounting and Tax

• Integration with Xero, FreeAgent, Sage, and QuickBooks
• Tax pot to automatically set aside income for tax (Pro and Team)
• Sole traders can join the MTD for ITSA waitlist to file directly from Monzo
• Expense cards with spending controls for team members (Team plan)

Opening an Account

Over 80% of Monzo business accounts are opened on the same day. The application is completed online or in the app. Only sole traders and limited company directors based in the UK can apply. Monzo is authorised by the Prudential Regulation Authority and regulated by both the PRA and the FCA. Financial Services Register number 730427.

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3. Wallester — Best for Teams, Cards, and Spend Control

What Makes Wallester Stand Out

Wallester takes a very different approach to business banking. Rather than a current account with banking features bolted on, it is purpose-built for card issuance and spend management. If your business needs to issue cards to a team, pay contractors, or control how money is spent across departments, Wallester is the most capable free option in this guide.

On the free plan, you get 300 virtual cards, unlimited physical Visa card issuance, and full spend control tools — including individual limits, merchant restrictions, and real-time notifications. All this comes at no monthly cost. Additional virtual cards are available from £0.30/month each on higher tiers.

The platform is PCI DSS compliant and uses 3D Secure authentication for all transactions. You can freeze or cancel any card instantly, set daily or monthly limits per card, and restrict cards to specific merchant categories.

Key Features

• Instant virtual card issuance — cards can be used immediately in Apple Pay, Google Pay, and Samsung Pay
• Physical Visa cards with standard or express delivery
• Multi-currency IBAN accounts — hold, send, and receive in GBP, EUR, USD, and other currencies
• Bulk payroll payments — pay up to 1,500 employees or contractors in a single batch
• Accounting integrations — sync to Xero, QuickBooks, NetSuite, and Sage
• Business dashboard to manage all accounts, cards, approvals, and FX in one place
• Mobile app for receipts, card management, and real-time balance
• Dedicated account manager on Platinum tier

Who Should Consider Wallester

Wallester suits businesses that already have a primary bank account and want a dedicated tool for card and expense management. It works well for agencies, e-commerce businesses, teams managing advertising budgets, hospitality businesses, and any organisation that needs to put spending in the hands of multiple people without losing control.

It is also worth considering for businesses with international suppliers or customers, given the multi-currency IBAN and broad currency support.

Wallester AS is a Payment Institution authorised by the Finantsinspektsioon (Estonian Financial Supervision and Resolution Authority) and an official Visa Principal Member. Registration code: 11812882. Wallester is not a bank. Funds are not covered by FSCS or equivalent deposit protection.

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4. Wise Business — Best for International Payments and Multi-Currency

What Makes Wise Stand Out

Wise built its reputation on international money transfers, and the business account carries those strengths directly. You get the mid-market exchange rate — the same rate you see on Google — with a transparent, low conversion fee. There are no foreign transaction charges on card spend, no subscription fee, and no markup hidden in the exchange rate.

The Wise business debit card works in over 160 countries across 40+ currencies. When you spend in a foreign currency, Wise automatically converts from whichever currency balance you hold with the lowest conversion fee. If you do not hold that currency, it uses its Smart Conversion technology to minimise the cost.

For UK-registered businesses, Wise also offers 0.5% cashback on eligible card transactions, including employee expense cards. This applies to all cards linked to your Wise Business account.

Banking and Payment Features

• Multi-currency account — hold, send, and receive in 40+ currencies
• Dedicated account details (account number, sort code, IBAN, SWIFT) for multiple currencies
• Send money internationally at the mid-market rate
• Receive payments from international clients as if you had a local bank account
• Business debit card — physical and virtual
• Employee expense cards for £3 per card
• Instant spend notifications and in-app card controls
• No foreign transaction fees on card payments
• 0.5% cashback on eligible UK business card transactions

What Wise Does Not Do

Wise is not a bank and does not offer UK business banking features like Corporation Tax filing, VAT returns, invoicing, overdrafts, or FSCS deposit protection. If these are important to your business, ANNA Money or Monzo would be a better fit. Wise works best as a standalone international payments and multi-currency tool, or alongside a primary UK business account.

Wise is authorised by the Financial Conduct Authority under the Electronic Money Regulations 2011, Firm Reference Number 900507. Wise is not a bank. Your funds are safeguarded in accordance with the Electronic Money Regulations but are not covered by FSCS deposit protection.

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How to Choose the Right Free Business Bank Account

No single account is right for every business. Here is a straightforward way to think about which provider fits your situation.

Choose ANNA Money if…

• You want banking and tax admin handled in one app
• You are a sole trader or limited company director who needs to file VAT, Corporation Tax, or MTD Self Assessment
• You want automated invoicing that chases clients for you
• You are a startup or freelancer who does not want to juggle separate accounting software

Choose Monzo if…

• You want a fully authorised UK bank with FSCS protection on your deposits
• You already use accounting software like Xero or QuickBooks and want seamless integration
• You want a business account backed by award-winning customer service
• You are a growing business that might need loans or overdrafts in the future

Choose Wallester if…

• You need to issue expense cards to multiple team members or contractors
• You want granular spend controls — limits per card, merchant category restrictions, real-time approvals
• You run a business with international suppliers and need multi-currency IBAN accounts
• You want to automate payroll or contractor payments in bulk

Choose Wise if…

• You regularly send or receive payments in foreign currencies
• You have international clients or suppliers and want to avoid FX markups
• You want a low-cost multi-currency account with no monthly fee
• You are comfortable managing tax and invoicing separately

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What Does ‘Free’ Actually Mean?

Every account on this list has a free tier — but free does not always mean the same thing.

ANNA Money’s Pay As You Go plan charges 0.95% commission on all incoming payments to your account and no commission on transfers from your own accounts. There is no monthly fee, but you pay per transaction on certain actions.

Monzo’s Lite plan is genuinely free with no transaction fees on standard UK transfers. You only pay if you upgrade to Pro or Team for additional features.

Wallester’s Free plan has no monthly fee and no per-transaction charges for most payments. You pay for additional virtual cards beyond the 300 included, and for delivery of physical cards.

Wise has no monthly or subscription fee but charges a one-time setup fee when opening an account, plus transparent per-transfer fees when sending money internationally. There are no foreign transaction fees on card spend.

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A Note on Regulation and Deposit Protection

All four providers in this guide are authorised and regulated in the UK or EU, but they are not all the same type of institution.

Monzo is a fully authorised bank, regulated by both the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA). Eligible deposits are protected by the Financial Services Compensation Scheme (FSCS) up to £120,000 per depositor.

ANNA Money and Wise are Electronic Money Institutions (EMIs), authorised by the FCA under the Electronic Money Regulations 2011. Your funds are held in safeguarded accounts, separate from the company’s own money, but they are not covered by FSCS.

Wallester is a Payment Institution authorised by the Estonian Financial Supervision and Resolution Authority (Finantsinspektsioon) and an official Visa Principal Member. It operates across the UK and EEA. Funds are not covered by the FSCS or equivalent deposit protection scheme.

You can verify the regulatory status of any UK financial firm at register.fca.org.uk.

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What You Will Need to Open a Business Account

Most providers in this guide allow you to open an account entirely online, often in under 10 minutes. Before you start, gather the following:

• Valid photo ID — passport or driving licence
• Proof of address — utility bill, council tax bill, or bank statement dated within 3 months
• Business registration details — Companies House registration number if you are a limited company
• Basic information about your business — what you do and how you earn

Sole traders generally have the simplest application process. Limited companies may be asked for additional director information and a Companies House confirmation.

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Frequently Asked Questions

Do I legally need a business bank account?

Sole traders are not legally required to have a separate business account, though it is strongly recommended for keeping finances clean and simplifying tax returns. Limited companies are effectively required to have one in practice, as company money must be kept separate from personal funds.

Is ANNA Money a bank?

No. ANNA Money is an Electronic Money Institution (EMI), not a bank. Your funds are safeguarded in accordance with the Electronic Money Regulations 2011 but are not covered by FSCS deposit protection.

Is Monzo a real bank?

Yes. Monzo Bank Limited is a fully authorised UK bank, regulated by the FCA and the PRA. Eligible deposits are protected up to £120,000 by the Financial Services Compensation Scheme.

Can I use Wise as my main business account?

Wise works well as a multi-currency account for international payments, but it lacks UK-specific features like Corporation Tax filing, VAT returns, and invoicing. Most UK businesses would be better served using Wise alongside a primary business account rather than as their sole account.

What is MTD for ITSA and who does it affect?

Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) is an HMRC initiative that will require self-employed people and landlords earning over £50,000 to keep digital records and submit quarterly updates using compatible software, starting from April 2026. ANNA Money’s Auto Accountant is HMRC-recognised and handles MTD for ITSA automatically.

Are there transaction limits on free accounts?

Each provider sets its own transaction limits, which are designed for security rather than restriction. ANNA, Monzo, and Wise all publish their account limits, which can usually be increased by contacting customer support. You can view ANNA’s current limits at anna.money.

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The best free business bank account depends entirely on what your business needs most.

If you want the simplest possible setup that handles your banking and your taxes in one place, ANNA Money is hard to beat — particularly for sole traders and small limited companies navigating MTD and Corporation Tax.

If deposit protection and full bank status matter to you, Monzo is the standout choice — backed by strong customer service and a growing feature set.

If card issuance and team spend control are your priority, Wallester gives you enterprise-grade tools on a free plan.

And if your business operates across borders, Wise remains the most cost-effective way to send and receive money in multiple currencies without being penalised by exchange rate markups.

All four accounts are free to open and free to run at the basic tier. There is no reason not to try the one that fits your situation — and no cost if you decide to switch.