Why You Need a Business Bank Account

When you first start out as a Virtual Assistant, there are a few housekeeping details to take care of immediately. One of the most important is to open a business bank account.

As soon as you begin getting paid as a Virtual Assistant, it’s important to establish a separate bank account for your business. You’ll want to do this no matter how your company is organized – as a sole-proprietorship, LLC or corporation.

First, call the bank you want to use (I recommend finding one with low fees and a low minimum balance requirement) and ask what kind of documentation and identification you’ll need to open a business account.

In most cases, the bank requires a simple form that you file with the town, city or state where you’re doing business. There’s usually a nominal fee that needs to be paid.

Once you open your account, you’ll use it to deposit all the money you make as a Virtual Assistant and to pay for all of your business-related expenses, such as your website hosting fees, software expenses, and your computer equipment.

Even if the dollars don’t add up to much when you begin, it’s important that you keep all of your VA money separate from your personal funds. This allows you to keep track of your business income and expenses and makes it easier to pay your taxes.

If you live in the US, the IRS has rules about what can be deducted as “business expenses.” If you use your personal bank account for these expenses, the IRS might not allow them even if they are legitimate.

Many people assume that having a separate bank account for business will add more complexity to their lives. I think it’s the exact opposite! I’ve had one from the beginning and not only has it simplified my life, it allows me to know what’s happening financially in my business at any given time.

Whether you’ve been in business for ten minutes or ten years, if you haven’t done so already, put this at the top of your to-do list and get it done!

If you’re not already a member of our Facebook Group, The Virtual Assistant Connection, and would like to join, here’s the link: https://www.facebook.com/groups/thevaconnection/