Bank account not set up for first payment

**Crossroads** · 15 March 2007, 09:19

Originally posted by Jog On

As a first timer I’ve only recently formed my Ltd, and sent off the forms applying for my bank account (RBS). They say it takes up to 10 days to do so if it isn’t set up by the time I get my first weekly payment what should I do? I get the feeling that receiving the payments into my personal bank account would be a very bad idea – visions of Father Ted saying “the funds were just resting in my account” come to mind.

Anyone else had a similar situation?

Simple: Don't invoice until your bank account is ready.

Although anyone who uses the phrase "...by the time I get my first weekly payment..." sounds awfully like a disguised employee to me ;-)

**VectraMan** · 15 March 2007, 09:22

Nothing wrong in theory with the funds resting in your account, as long as you don't pretend it's yours. If it generates any interest, that's the company's too.

But I would just wait a week. If you're being paid weekly by an agent, they won't have any problem with making a double payment the week after.

**Jog On** · 15 March 2007, 09:57

Thanks

**boredsenseless** · 15 March 2007, 10:00

Originally posted by VectraMan

Nothing wrong in theory with the funds resting in your account, as long as you don't pretend it's yours. If it generates any interest, that's the company's too.

But I would just wait a week. If you're being paid weekly by an agent, they won't have any problem with making a double payment the week after.

Oh yes there is, It's a loan and you have to declare it, and how can you determine how much interest is yours and how much the company's?

Also a decent agent won't pay into a personal account as it can implicate them in any future investigation you may recieve.

Follow the good advice from VectraMan and just wait a little while to invoice.

**oraclesmith** · 15 March 2007, 13:57

I've had that situation and I just waited until I got the bank account number etc.

Another idea would be to see if they would pay you by cheque made out to your limited company instead of by bank transfer. This may help with any credit-taking they might do (eg. going direct to clients means you typically have to wait 4-6 weeks from invoicing to actually receiving the payment). Having a cheque in hand or in the pipeline means you can put it into your account the moment you receive the bank details.

**kirk** · 15 March 2007, 14:23

Same problem here, it took over a month for my Ltd's account to be set up with Natwest for various reasons; I just held back on the invoicing until it was set up.

**VectraMan** · 15 March 2007, 14:36

Originally posted by boredsenseless

Oh yes there is, It's a loan and you have to declare it, and how can you determine how much interest is yours and how much the company's?

Well I said "in theory". And you could work out interest based on the length of time the money was resting and the other money in the account, though it would get complicated.

Is it a loan? If you use the money to live on or buy something it's a loan, but if you're just using your personal bank account temporarily for convenience (and you have a good reason) it's not a loan. The important thing is that it's not your money, and you shouldn't benefit from it in any way.

**rawly** · 29 March 2007, 15:28

I've been just going through this. I setup my Ltd on 2nd March, and decided to go with A&L. Still heard nothing last week, and when I phoned they said they are currently taking 28 days to open new accounts due to a backlog - I wonder what caused this then!?

So, I've been hanging on with my MSC, and now next week is the last before 6th April - so I'll need to stop using them. Because I've got no account number I still ain't been able to send off my VAT registration - so this is a really big delay that is very inconvenient.

Has anyone else formed a company in the last month and found a big delay in opening a business account?

**malvolio** · 29 March 2007, 15:35

There's always a delay of some kind, just that some banks are better than others. As you say, I suspect there's a bit of a rush on right now, with some 50k ex-MSC people switching to Ltd Co status at the last minute.

Get a cheque, file it until everything is ready; its not like you can pay yourself anything anyway. It can still be used as an asset if YourCo should need it.

Or you could always sell something to YourCo - a PC with some useful software on it or something - to the value of that cheque and take it in payment... You're a business now, start thinking like one.

Bank account not set up for first payment