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TLDR
- Everyone who owns a business should open a business bank account as early as possible—preferably, before starting to operate.
- Opening a business bank account helps to establish credibility, separate personal and business finances, simplify tax filing and more.
- There are four types of business accounts, and you don’t have to choose just one. Many business owners use multiple accounts to keep different financial activities separate.
- It’s easy to open a business chequing account at RBC—you could have your account number in less than 15 minutes.
Whether you’re drawing up your business plan or already bringing in revenue from a side hustle, opening a business bank account is one of the best things you can do for your business. With a dedicated business account, you can keep your business and personal finances separate, which helps you strengthen credibility, keep clean financial records, simplify cash flow management and more. In this article, we’re diving deeper into the benefits of a business bank account, the different types available and how easy it is to open your own.
Do you need a business bank account?
Whether you’re starting a sole proprietorship, partnership, corporation or non-profit, opening a business bank account sets you up for financial clarity from day one. The moment money starts moving in or out of your business, it needs a “home” outside of your personal bank account. While mixing your business and personal finances may feel like the simpler option at first, it can create a tangle that only gets harder to unwind over time. That tangle might show up as unclear financial records, tax-time scrambling, poor visibility into cash flow and business finances that don’t add up.
On the other hand, there’s a lot to gain when you open a business bank account early on in your journey.
Tip
At RBC, we require even sole proprietors operating under their own name to have a business account. Other financial institutions may only require you to have a business bank account if you operate under a business name. However, if you incorporate, you are legally required to have a business account as the business is a separate legal entity and can’t operate using your personal banking account.
What are the benefits of opening a business bank account?
Opening a business bank account helps to establish credibility, separate your personal and business finances, simplify tax filing, improve cash flow visibility and more. While it may be tempting to operate your business from your existing personal account, separating your finances early on helps you avoid complications and take advantage of the following benefits:
- Establish your business: A business bank account signals to vendors, suppliers, customers and investors that your business is legitimate and properly set up—so you can bank and send payments under your business name.
- Separate business and personal funds: A dedicated business account separates your personal and business finances, making your everyday banking easier to manage.
- Keep records clean: By keeping your business transactions in one dedicated business bank account, you can reduce administrative work and make it easier to create financial statements and stay on top of reporting.
- Streamline business payments: Easily pay invoices, accept payments from customers, send money and integrate your business bank account with popular accounting software and merchant services.
- Stay on top of cash flow: A business account gives you a clear view of your cash position at all times, helping you adjust your budgets, forecast cash flow and make informed financial decisions.
- Simplify tax filing: Keeping all your business income and expenses in one place makes it easier to prepare tax documents, claim eligible business expenses and work with an accountant.
- Build credit history: Establish a financial track record with the bank in your company’s name separate from your personal finances. This can strengthen your credibility with banks and make it easier to apply for business credit cards, lines of credit and loans in the future.
By opening a business bank account at RBC, you can also enjoy features like unlimited deposits from your company’s Moneris‡ transactions1 and exclusive services and offers beyond banking.
Business Bank Account vs. Personal Bank Account: What Should I Use for My Small Business?
From cleaner records to enhanced professionalism, see why a business account is better than a personal account for your small business.
Read moreWhat are the different types of business bank accounts?
There are four types of business bank accounts, each one designed for a different purpose. You can have more than one type of business account (and more than one of each type).
| Account type | What it’s for |
|---|---|
| Business chequing accounts | Day-to-day business needs, such as deposits, withdrawals and bill payments |
| Business savings accounts | Earning interest on available funds while still having easy access to your money |
| Business trust accounts | Maintaining, controlling and managing funds on behalf of clients |
| Foreign currency accounts | Managing foreign currency inflows and outflows without converting each transaction |
While some businesses may not need a trust or foreign currency account, every business needs a chequing account for daily operations (that’s why it’s often called an operating account). You may also want to open a business savings account to have an “out of sight, out of mind” place to earn interest on excess money you don’t need for day-to-day operations.
What documents do you need to open a business bank account?
While the specific details and documents required will vary by financial institution, here’s a checklist of common documents to have handy when opening a business bank account. If you’re not sure which documents you’ll need to open an RBC business account, call our 24/7 Business Helpline at 1-800-769-2520.
Checklist: Documents you’ll need to open your business bank account
| Type of Business | Personal Identification | Business Documents |
|---|---|---|
| Sole Proprietors (if operating under a registered trade name) | ID for sole proprietor/account opener |
Trade Name Registration or Master Business Licence (MBL) |
| Partnerships or Limited Partnerships | ID for all partners |
Registered Declaration of Partnership or Copy of Partnership Agreement (where Provincial Law does not require registration) |
| Corporations incorporated for 12+ months (including Not for Profit Corporations) | ID for all directors or officers |
Articles of Incorporation/Association and one of the following: Certificate of Status Annual Government Filing Corporate Profile Report Company’s most recent notice of assessment (Income Tax Assessment) Business License or Vendor Permits Health or Safety Certificates Liquor License Business Number Certificate of Existence Certificate of Compliance |
| Unincorporated Associations, Community Groups, Not for Profits | ID for all signing officers |
Articles of Incorporation or Original Constitution and Bylaws |
| All Business Structures Operating as Registered Charities |
Charity Registration Number |
Need to register or incorporate? Do it in less than 15 minutes with Ownr. Plus, access tools and resources to help manage your business as you launch and grow.
View Ownr OfferHow do you open a business bank account?
It’s easy to open a business chequing account at RBC—you could have your account number in less than 15 minutes.
Here’s how it works:
Choose your account and start your application online.
After applying, visit a branch to verify your documentation.
Start using your account. It’s as easy as that!
Note: Call us at 1-800-769-2520 if you will have multiple authorized signers, want to open a specialty account (such as the Royal Business Community Account or the U.S. Dollar Business Account) or prefer to talk to someone about your options.
Which RBC business chequing account is right for you?
The best RBC business chequing account for you will depend on your day-to-day banking. To help you compare your options, here’s an overview of our business chequing accounts—and what they’re ideal for. Once you've found the right chequing account, you may also want to consider opening a business savings account to support your other banking needs.
Best for digital and in-branch banking
Flex Choice Business Account
$7 monthly fee2
- Bank both digitally and in-branch
- 40% savings on certain transactions5
Best for high-volume transactions
Ultimate Business Account
$100 monthly fee2
- Highest included transaction limits
- Monthly fee waiver with $75,000 minimum daily balance6
Best for non-profits
Royal Business Community Account
$3.75 monthly fee
- Monthly fee waiver for first 3 months*
- Reduced fees for eligible groups
Best for making and receiving payments in U.S. dollars
US Dollar Business Account
$9 monthly fee
- Pay-as-you-go pricing
- Savings on foreign exchange costs
Want help finding the right business account? Answer a few questions, and we’ll recommend one for you.
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Ready to open a business bank account?
Apply online to get your account number in less than 15 minutes.7
Choose your account >Note: For RBC Specialty Accounts, call 1-800-769-2520 to apply.
FAQs About Opening a Business Bank Account
Using a personal account for your business is not recommended. If you plan to incorporate your business, the business will be considered a separate legal entity and you will need to have a business bank account. At RBC, we require even a sole proprietor operating under their own name to have a business bank account.
Here are a few ways a business bank account can help you:
- Show suppliers, vendors, investors and customers that your business is legitimate
- Track and control your business expenses and keep them separate from personal transactions for convenient bookkeeping
- Easily send and receive business-related payments—for example, pay bills, deposit funds and send transfers
- Simplify your tax filing at the end of the year with all your business transactions in one place—plus, you can deduct business account fees as a business expense
- Access exclusive services and offers available only to RBC business clients
- May help you qualify for a business credit card if and when you need one
There's no minimum balance needed to open most RBC business bank accounts and your account could include a higher overdraft limit than your personal account.
It depends on the type of account you open and the individual account you choose.
- Business chequing accounts typically include a monthly fee, as well as fees and charges for services and transactions beyond what’s included in the account package.
- Business savings accounts do not typically include a monthly fee; however, there may be fees for certain services and transactions.
- Foreign currency accounts typically include a monthly fee, as well as fees and charges for certain services and transactions.
- Business trust account fees vary based on your business chequing account.
You can use our fee estimator tool to estimate your monthly business chequing account fees (including the account’s monthly fee plus any variable fees) to get a recommendation on the best RBC business chequing account for your usual activity.
Whether you choose to open a business account online, by phone or in person, you’ll need to bring the following information to an RBC branch to verify your identity:
- One of three Government-issued IDs, such as a Canadian Passport, Canadian Driver's Licence or Canadian Permanent Resident Card
- A business registration document, such as Articles of Incorporation , Certificate of Existence or Master Business Licence
Need to register or incorporate? RBC and Ownr* have teamed up to help you register and incorporate your business for less. Learn more.
*Ownr is a business of RBC Ventures Inc., a subsidiary of Royal Bank of Canada
No, your business does not need to be incorporated to open a business bank account. Sole proprietors, partnerships, charities and non-profit organizations can also open business bank accounts.
You can open select RBC business chequing accounts online in less than 15 minutes—including the RBC Digital Choice Business Account, RBC Flex Choice Business Account and RBC Ultimate Business Account. Once you complete your application, you'll automatically receive your business bank account number. However, you may need to visit a branch to verify your identity and activate your account.
There is no limit on the number of business bank accounts you can have. You can open more than one of each account type:
- Business chequing accounts
- Business savings accounts
- Business trust accounts
- Foreign currency accounts
For example, some businesses have more than one business chequing account to strategically separate certain financial activities and obligations, such as payroll, operating expenses, funds for GST/HST taxes and more.
Ownr is an RBC Ventures company.
This information is not to be taken as legal advice and RBC is not responsible for any actions taken.
No endorsement of any third parties or their advice, opinions, information, products, or services is expressly given or implied by Royal Bank of Canada or its affiliates.
All other trademarks are the property of their respective owner(s).
There may be certain events, circumstances or incidents outside our control that disrupt the service or otherwise delay deposits. Funds availability is subject to client agreements.
Standard fees and charges apply for services and transactions exceeding the number included in the account package.
Includes electronic (digital) debit and credit transactions to the account, such as online bill payments, pre-authorized payments (PAPs) and point of sale (POS) transactions. Standard fees apply for other services, including cash deposited at RBC ATMs, Pay Employees & Vendors (PEV), Interac e-Transfer transactions and wire transfers not expressly included in the package when completed online. For full list of fees please refer to the standard fees and charges guide.
Includes cheques deposited through the RBC Mobile app, RBC ATMs and ChequePro.
Savings accrue from lower standard processing fees charged on electronic (vs. paper) transactions such as online bill payments, pre-authorized payments (PAPs) and point of sale (POS) transactions. Standard fees apply for other services, including cheques and cash deposited at RBC ATMs, Pay Employees & Vendors (PEV), Interac e-Transfer transactions and wire transfers not expressly included in the package when completed online.
Fee waiver applies only to the monthly package fee when the minimum daily balance is held for the entire month.
In order to get a business bank account and account number online, the business must be a sole proprietorship or a single-owner corporation, in each case, with only one authorized signatory. The business must be registered in Canada or a business operated in Canada by a natural person who is a permanent resident of Canada. Additionally, the authorized signatory completing the online application on behalf of the business must successfully complete the personal identification portion of the application, including, without limitation, a credit bureau report to the satisfaction of Royal Bank of Canada. Multi-owner businesses or businesses that have more than one authorized signatory will be directed to the branch to get a business bank account and account number. Issuance of an account number does not guarantee that the account is operational. RBC may restrain the use of the account and require the business client to visit a branch to satisfy any outstanding requirements prior to operating the account. RBC reserves the right, in its sole discretion, to require that the business client visit a branch to complete the application. A business client that successfully completes the online application will still need to visit a branch to obtain a business client card and sign additional documentation, even if a bank account number has been issued. Actual completion time may vary from person to person and may be affected by a variety of external factors, including internet navigation speed and other interruptions. RBC does not accept any responsibility for any damage or loss that any parties might suffer resulting from any deviations from time indicated.