Small business startup

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sleemanj

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#315460 6-Apr-2010 18:57

tcpdump:
Let me rephrase: a _new_ personal account that I will use only for the business purposes and it will be personal just from the bank point of view.

Sure that's no problem, I did that for years with both BNZ and KiwiBank, I expect most banks will be fine with it since you're basically just a self employed guy, it's what KiwiBank had people do before they had business accounts.

---
James Sleeman
I sell lots of stuff for electronic enthusiasts...

Filterer

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#315466 6-Apr-2010 19:11

tcpdump: That's correct, but can I use the fastnet classic (free one) for a business account?

What free one do you mean? Fastnet classic is perfect for small business and the accounts all appear in the companies name which is a bit more legit than using a separate personal account.

Like I said, an everyday account and savings account costs me between $5 and $7 a month depending on the number of transactions and they show up completely independently when you login to fastnet classic (although you use the same login)

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PenultimateHop

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#315471 6-Apr-2010 19:38

An alternative to getting a business credit card is to use your own personal credit card and expense claim it through your business accounts. Getting a business credit card can be a real pain, particularly for new businesses.

Just bear in mind that ASB prohibits the use of their personal credit cards with True Rewards for business activity (section 4.3 of the True Rewards T&C). This is a personal bugbear of mine.

tcpdump

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#315479 6-Apr-2010 19:50

I think the easiest way would be to open a new personal account and get a Visa Debit associated to the cheque account and use that account exclusively for the business purposes.

Thanks a lot for all explanations.

dman

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#323347 27-Apr-2010 03:10

your local CAB is very helpful for people new to this :)

http://www.cab.org.nz/

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webwat

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#325700 1-May-2010 23:53

The bank doesnt need to know its a business account, just make sure you account for any transfers to or from your other accounts, eg drawings or capital injection/borrowing.

If you get setup for GST and need to claim car expenses etc then it starts to get messy, so an accountant makes sense. But then you might be better at tax returns than I am.

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richms

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#325815 2-May-2010 16:43

fastnet classic uses a persons login who has to be credit checked etc and has no ability to limit their actions on accounts. If you are hiring people then it is totally unusable for business use as you either have to take them into asb and they have to pass the stupid credit check process to get a password, of you have to share your one which is totally against the T&C of the bank and means they can see any personal accounts you have with the bank.

Also if you are a personal guarentor on any loans the business takes out, they will just pull it from your personal account without asking if you fall behind, and then all your personal direct debits will fail.

IMO best to have seperate bank, and the proper business banking processes. Westpac are keen to help small busnesses when I last asked.

Richard rich.ms

ImpactPR

3 posts

Wannabe Geek

#327852 7-May-2010 22:57

if you are starting up a small business you may find some of these locally written tips of interest : 10 Tips For a Successful Small Business Startup

scottlilly

14 posts

Geek

#330520 15-May-2010 21:50

Just a couple of notes that are worth making here:

1) You say you are new to New Zealand, please make sure that your entry clearance allows you to participate in business activities.

2) If you have registered a company and intend for that company to trade in New Zealand you should not use a personal bank account for it. A personal bank account in your own name is legally yours. Any income and expenses in that account are legally yours. Sure, some people turn a blind eye to that sort of thing, and account for their companies through personal accounts, but you shouldn't. Do it properly and register a bank account for your company.

Using a personal credit card is okay as long as you keep your receipts for proof of purchase, then when you pay the card from your business account or transfer yourself money you can show what that sum was for.

You also then remove yourself from potential personal liability claims also (why go to the expense of having a company structure if you don't enjoy the protection it affords you?).

3) Don't cheapen out on legal advice. Talk to an accountant and a lawyer first. You do need to spend a couple of hundred dollars, swallow it, do it.

Your alternative is to run this small, part-time business as a sole trading enterprise. By that I mean NOT a company. Basically all it means is that the business is you, not a company, and you don't need to worry about company registrations and maintenance and all that jazz. This is a good option for a low-budget start up and if things take off you can pay the money to setup a company properly later.

-Scott

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