Client struggling to open business bank account

Client struggling to open business bank account

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Evening All,

Hoping someone can shed some light on this.

My client is struggling to open a business bank account.

The bank have now asked him which one of the following is his company?

A - Active non financial entity

B - expected non financial entity

C - Passive non financial entity

I've not come across this before, any help would be appreciated.

Thanks :-)

 

Replies (21)

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By qhas
11th Nov 2015 22:07

What bank is this ?
Shall avoid it like the plague

Thanks (1)
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By hje
11th Nov 2015 22:09

I

believe your bank should provide a set of definitions alongside this question in order to help you select which applies.

A similar institution has provided a set of definitions here, which may prove of use: https://corporate.bankofireland.com/fs/doc/d5131-govco-self-certification-for-fatca-june-2014-5.pdf (see the glossary at the end)

 

 

Thanks (1)
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By cparker87
11th Nov 2015 22:10

what....
Is this the Americans again? FATCA?

If the bank only want non financial entities we're going to be in trouble.

Thanks (1)
the sea otter
By memyself-eye
12th Nov 2015 09:25

unless it is a bank

or dormant, tick box 'A'

That will satisfy the beaurocrats at the bank...

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By lovebucket
12th Nov 2015 10:16

Two words: Metro Bank

Thanks (2)
Replying to OldParkAcct:
Euan's picture
By Euan MacLennan
12th Nov 2015 10:23

Two words

lovebucket wrote:

Two words: Metro Bank

Are you naming and shaming the bank which asked the questions or recommending a bank which opens accounts without asking questions?

Thanks (1)
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By lovebucket
12th Nov 2015 10:28

Sorry, should have elaborated with more words :)

They're very good, sent clients there who were having trouble elsewhere and not problems.

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Routemaster image
By tom123
12th Nov 2015 10:38

When changing to HSBC, we selected active non financial entity. From memory (forms not to hand) this was to do with FATCA.

Non financial meaning not involved in financial services.

Thanks (2)
Replying to Tax Dragon:
paddle steamer
By DJKL
12th Nov 2015 10:56

So nothing

tom123 wrote:

When changing to HSBC, we selected active non financial entity. From memory (forms not to hand) this was to do with FATCA.

Non financial meaning not involved in financial services.

So nothing to do with making derogatory statements  about the girth of Scottish Chartered Accountants then?

Thanks (2)
Red Leader
By Red Leader
12th Nov 2015 10:51

world government

Not only are we in the EU, it also appears we are in the USA!

Bloody cheek.

Thanks (4)
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By DMGbus
12th Nov 2015 21:41

Lloyds is bad

I've only heard of two bad stories this past six months with bank accounts.

Instance once - a long established customer (over 25 years with Lloyds / TSB) was subjected to an excessively long list of items to prove their identity, presumanly a fresh from College youngster was over-applying CDD proceedure rules.

In another instance of Lloyds bank the bank asked that I wrote a letter to confirm client director's details as " date of birth incomplete at Companies House" (I educated the bank on this dates of birth issue) plus "names in  incorrect order at Companies House" (Again an education lesson for the bank, to all sensibe people it is clear that "SMITH, John" is "John Smith" as Companies House list the names in the format "SURNAME, Christian name".

If these two experiences are typical of LloydsBank then I look forward to Lloyds bank ceasing to be for want of customers.

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By chloe77
13th Nov 2015 11:17

Thanks for all your comments, it's Yorkshire Bank!

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Replying to An_a:
Out of my mind
By runningmate
13th Nov 2015 11:30

Aww gee

chloe77 wrote:

Thanks for all your comments, it's Yorkshire Bank!

I think you mean New York (shire) Bank!

RM

Thanks (1)
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By Blakeney
13th Nov 2015 12:03

Size is no defence

I've seen this twice recently, both small charities (under £10,000) with the same branch of HSBC. Fortunately the local staff thought it was as silly as we did and helped fill in some useful forms.  It's definitely US inspired because some of the useless forms were actually IRS based.   

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By ColinNibbs
13th Nov 2015 13:10

Yes it's FATCA

Yes it is FATCA. I look after a private members' club banking with HSBC. In the post came a three page letter, numerous forms to complete and technical instructions - about 30 pages in all, none of which were stapled together. HSBC wash their hands of any kind of help in filling in these forms, saying you must consult a tax advisor if help is needed.

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Replying to whitevanman:
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By petestar1969
13th Nov 2015 15:31

..

ColinNibbs wrote:

Yes it is FATCA. I look after a private members' club banking with HSBC. In the post came a three page letter, numerous forms to complete and technical instructions - about 30 pages in all, none of which were stapled together. HSBC wash their hands of any kind of help in filling in these forms, saying you must consult a tax advisor if help is needed.

 

That's probably got more to do with HSBC not wanting business customers and planning to leave the High Street than anything else. I heard on the grapevine that HSBC just want to deal with big business now.....

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Replying to whitevanman:
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By cacatchpole
13th Nov 2015 15:26

PTAs too

I'm treasurer for our school PTA and we got one of these forms too.  HSBC in branch very sympathetic but unable to help in anyway whatsoever.  Was very tempted to send back saying it's completely irrelevant to us (a UK based registered charity with no links to the US whatsoever) but apparently they can then close down your accounts with them.  I seem to recall "Active" was basically earning money not through investments and "Passive" is nearly all income through investment.  Although the staff at branch agreed that the definitions provided were not clear, but "go see a tax advisor" (like a PTA has the funds for specialist tax advice).  Makes one want to stop volunteering for stuff and go and get a proper job...

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By petestar1969
13th Nov 2015 14:18

Well

We have a deal with APS (Advanced Payment Solutions). They specialise in contractors and set up bank accounts within 72 hours maximum (and they pay us £50 for each referral we make  to them).

 

Happy days!

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Replying to DJKL:
By taxbakbristol
14th Nov 2015 02:35

APS

Do you have further details please?

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Sarah Douglas - HouseTree Business Ltd
By sarah douglas
14th Nov 2015 12:43

Guidance from The Investment Association- hope this helps

Hi 

I have attached this link below it is very useful.  It explains your above questions quite well for entity's to open bank accounts in simple terms.  

Guidance for self entity certfication - Aug 2015

PS Link does not work because it is a PDF   if you google Guidance for self entity certfication - Aug 2015 it will appear at the top

 

On a other note for smaller Ltd Companies: 

I appreciate it may not be a bank that is suitable for client, 

I was helping a client open a company Ltd  account at Santander.   I had them in my office to give them a hand.   They already had a personal account with them so that probably made it easier with MLR and credit check.  Quite a few of my clients have business accounts with Santander and they are very efficient and online facilties are easy and simple to use , unlike some clients with RBS

 

experience:

The bank rang bank at Schedule time .  We had everything at office re info that was needed. Questions were asked and extra services where offered if needed. 

Account was set up there and then after credit check and appeared on the clients online banking above the personal account as he was a sole director company. 

They gave him a Business Ltd current account and Business Ltd Savings Account. 

The company Debit cards and cash card for the savings account arrive within 3 days. 

 

PS:  I know it much easier if you are sole Director but the point is the likes of RBS, Bank of Scotland and others where a nightmare.   We had wanted to have the Ltd company with a different bank to his personal but in the end the client was losing the will to live. 

It took  30 minutes in 2 calls for Santander  answering details about projected profit, expenses and the type of clients they were expecting.  We had one issue about names on companies house form , bank talked us over the phone where to change it on companies house and then   the same girl rang bank at 10.00 am the next morning as arranged and continued the application.  

They have a start up Ltd company current account free banking 

the next one is 7.50 a month fixed with in the tariffs  and they have another 2 business and corporate accounts  as your company grows.  

 

I just do not understand why the banks make it so difficult they have credit checks and always asking for everything to be guaranteed so they can remove overdraft quickly I am sure under small print rules somewhere .  Their a law onto themselves.   RBS business managers have being ringing clients of mine about the personal accounts which have nothing to do with the Ltd company. 

 

 

 

 

 

Thanks (1)
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By sparkler
14th Nov 2015 17:57

Handelsbanken

I'm not sure what range of business current accounts they offer, but we have had a fantastic experience with Handelsbanken when taking out a new mortgage last year. Unlike high street banks, they didn't ask lots of silly questions, and actually took notice of our actual income to determine whether we would be able to make mortgage repayments. I should imagine they would apply a similar "common sense" attitude to their dealings with business customers. I would highly recommend.

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