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Alvin

BTL and Flips Different Bank Accounts

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I am thinking of having 2 separate SPVs for BTLs and Flips. I would really appreciate if I have some feedback regarding how others manage the bank accounts.

Do you have 2 separate bank accounts? one to be used only for BTLs and one for Flips?

If yes, do you open it with the same bank ?

Thank you

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Hi Alvin,

The decision to have separate SPV's for different strategies is entirely down to you. If this is how you proceed, it is recommended to have a separate Business Bank account for each Company/SPV. It makes accounting, tracking your transactions, justifying transactions etc much easier.

There is no issue with having multiple business bank accounts with the same bank. In most cases this makes sense as the bank will already have your details for your first account and creating subsequent accounts becomes a much quicker process.

With having multiple SPV's, the operational costs will increase but I would say this is offset by the efficiency it brings.

Note: Most Business accounts do not charge for the first 12/18 months of operations, but some may start to charge something like £5 a month. I would begin with looking at the Business accounts offered by the bank provider of your personal account and see how they compare with the rest of the market.

I have seen several people recommended using Starling for creating business accounts,  I believe there are no costs involved. I personally haven't used them though.

Hope that helps!

Onkar

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Hello @onkar Thanks for the information and your point of view. It makes sense, I already have a business bank account and will see what they need to open another one.

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I have a couple of business accounts with Metro - and there is no fee as long as you keep a balance of >£5k. Been very happy with them for the last few years. And bonus, for me anyway, no card reader authentication device. I use another business a/c with Lloyds, and I hate having to carry that thing around with me!

I would personally stick with one bank account per SPV. I link my bank accounts with Xero which means my bank transactions are brought in automatically every day into my bookkeeping software. That makes keeping records very easy. 

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@lah111, it makes sense! Thank you! The little things make life much easier. Right, the card reader authentication is a real pain sometimes if it is not with you especially when away and need to make a payment.

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