As a business owner, having a separate bank account for your business is essential. Not only does it help you keep track of your business finances, but it also helps you avoid any legal or tax issues that may arise from mixing personal and business funds. In this article, we will explore the 15 best business bank accounts in Canada for 2023, along with their fees, benefits, and drawbacks.
To help you make an informed decision, we’ve compiled a list of the 15 best business bank accounts in Canada for 2023
1. Wise Business Account
The Wise Business Account is ideal for businesses that have international employees or conduct business in different currencies. With this account, you can send and receive money in multiple currencies with competitive exchange rates. There is a one-time $42 fee to set up international banking, and small fixed fees apply to send money. The account is best suited for freelancers and businesses that get paid in various currencies.
2. Alterna Small Business eChequing Account
The Alterna Small Business eChequing Account is perfect for small businesses that conduct mostly electronic transactions. With a daily closing balance of $3,000, there’s no monthly account fee, but there’s a $5 fee if the balance falls below that threshold. The account also charges $1.50 for each additional outgoing Interac e-Transfer and $2 for every $1,000 deposited in person at a branch.
3. Tangerine Business Accounts
The Tangerine Business Accounts offer a no-fee, no-minimum balance option for business owners who want to earn interest on their funds. Note that you must connect a business chequing account to it during the account opening process. This account is best suited for earning interest on funds you don’t need to run your business.
4. Wealthsimple Save For Business Account
The Wealthsimple Save For Business Account is a no-fee account that enables you to earn more on your business savings. Additionally, you can open a business investment account to invest your savings. This account is ideal for business owners looking to earn higher interest on their savings.
5. Manulife Business Advantage Account
The Manulife Business Advantage Account allows businesses to earn interest on Canadian and US dollars that aren’t required for business operations. Deposits and transfers to linked accounts are free, while bill payments and Interac e-Transfers cost $1.00, and a monthly paper statement costs $2.00.
6. RBC Digital Choice Business Account
The RBC Digital Choice Business Account is perfect for small businesses with mostly electronic transactions, including both debit and credit. The account charges $1.50 for each additional cheque deposit, $2.50 each for $5/$1,000 cash deposits at a branch, and $3.50 for paper statements.
7. TD Basic Business Plan Account
The TD Basic Business Plan Account is an excellent option for small businesses that only require a few transactions per month. The account charges $1.25 per extra transaction and $0.22 per additional deposit. For cash deposits, a $2.50/$1,000 fee applies. You can also get a free TD Business Savings Account with this account.
8. Scotiabank Basic Business Account
The Scotiabank Basic Business Account is an excellent option for businesses that have a large balance and already bank with Scotiabank. The account charges $1.25 for additional debit purchases, $2.50/$1,000 for cash deposits, and $2.50/$100 for coin deposits.
9. CIBC Everyday Business Operating Account
CIBC’s Everyday Business Operating Account is a popular choice among small business owners looking for a free bank account while maintaining a large minimum balance. Additional transactions cost $1.00 to $1.25, and printed statements are $3.50 each. There is a charge of $2.25-$2.50/$1,000 for cash deposits and $2.50/$100 for coin deposits. Other fees may apply, but with a large minimum balance, most of these fees can be waived.
10. BMO Business Builder Account
The BMO Business Builder Account is an excellent choice for small business owners who want to keep their banking fees low. Additional transactions cost $0.60 (electronic transactions) or $1.25 (branch transactions), and there is a charge of $2.25/$1,000 for cash deposits and $2.25/$100 for coin deposits. Monthly paper statements cost $4.00.
11. TD Unlimited Business Plan Account
The TD Unlimited Business Plan Account is ideal for small to medium-sized businesses with lots of transactions and deposits. Additional cash deposits cost $2.50/$1,000 (i.e. exceeding the $25,000 included each month). This account also offers a free premium business credit card, making it a popular choice among business owners.
12. RBC Ultimate Business Account Package
The RBC Ultimate Business Account Package is perfect for small to medium-sized businesses with lots of debit and credit transactions. Additional paper transactions cost $1.25 each, and extra cash deposits are $2.50/$1,000. Paper statements cost $3.50 to $4.50 each.
13. CIBC Unlimited Business Operating Account
CIBC’s Unlimited Business Operating Account is designed for high-volume businesses looking for an affordable bank account with unlimited transactions. This account charges $3.50 for paper statements and $2.50/$1,000 for cash deposits exceeding the $15,000 that is free monthly.
14. Scotiabank Unlimited Business Account
The Scotiabank Unlimited Business Account is an excellent choice for businesses that conduct lots of electronic and paper transactions, as well as cash deposits in the branch. Additional cash deposits cost $2.50/$1,000.
15. ATB Unlimited Business Account
Finally, the ATB Unlimited Business Account is a great option for businesses that want unlimited transactions but also need to keep their banking fees low. This account charges $2.50/$1,000 after free $15,000 and $2.50/$100 for coin deposits after free $1,500. Cheque fees apply after 70 free items, and the fee is $0.22 per cheque.
What is a Business Bank Account?
A business bank account is a financial account that is specifically designed for businesses to manage their finances. It allows business owners to keep their personal and business finances separate, making it easier to track business expenses, manage cash flow, and file taxes. Business bank accounts can come with a variety of features, such as overdraft protection, debit cards, and online banking services.
How To Open a Business Bank Account in Canada
Opening a business bank account in Canada is a straightforward process. To open an account, you will need to provide the bank with the following information:
- Business name and registration number
- Business address and contact information
- Business structure (e.g., sole proprietorship, partnership, corporation)
- Identification documents for all signatories on the account
- Business financial statements (if applicable)
Once you have provided all the necessary information, the bank will review your application and may conduct a credit check before approving your account.
Pros of a Business Bank Account
There are several advantages to having a business bank account, including:
Keeping personal and business finances separate: By having a separate bank account for your business, you can avoid mixing personal and business funds. This makes it easier to track business expenses, manage cash flow, and file taxes.
Building business credit: A business bank account can help you establish a credit history for your business, which can be useful when applying for loans or credit in the future.
Professionalism: Having a separate business bank account adds a level of professionalism to your business and can help you build trust with customers and vendors.
Access to business banking services: Business bank accounts often come with a range of banking services designed specifically for businesses, such as online banking, overdraft protection, and merchant services.
Cons of a Business Bank Account
While there are many benefits to having a business bank account, there are also some drawbacks to consider:
Fees: Business bank accounts often come with fees, such as monthly maintenance fees, transaction fees, and overdraft fees. It’s important to choose an account that fits your business’s needs and budget.
Minimum balance requirements: Some business bank accounts require a minimum balance to be maintained in order to avoid fees. This can be challenging for businesses with limited cash flow.
Documentation requirements: Opening a business bank account requires more documentation than opening a personal bank account, which can be time-consuming.
In conclusion, choosing the right bank account for your business is an important decision that can impact your business’s financial health. When selecting a bank account, consider the fees, your business’s unique needs, and the level of customer service offered by the bank. By selecting one of the 15 best business bank accounts in Canada for 2023, you can ensure that you have the right account to help your business thrive.