How to open a business bank account, and set it up in your books

Why a separate account

One account for the business and nothing else is the single best bookkeeping decision you can make. It means:

Your books can be checked. Every transaction in the bank statement belongs to the business, so you can reconcile every month and be sure nothing is missing.
Tax time is quicker. Nobody has to sort grocery runs from supplier payments.
Audits are simpler. The IRS and CRA both expect you to support your income and expenses. Mixed accounts invite questions about every personal deposit.
The liability shield holds. For an LLC or corporation, paying personal costs from the business account (or the reverse) is one of the things that can lead a court to treat the business and owner as one.
You can see how the business is doing. The balance is the business's money, not a mix of yours and its.

Choosing the account

Compare at least two banks or credit unions. Things worth asking about:

Monthly fee and how to avoid it, for example by keeping a minimum balance.
Transaction limits: how many deposits, cheques and electronic payments are included before per-item fees.
Cash deposits, if you take cash: branch access, night deposit, and any cash-handling fees.
Electronic payments: ACH and wire fees in the US, EFT, Interac e-Transfer and wire fees in Canada. If you will pay staff by direct deposit, ask whether the bank accepts a NACHA (US) or CPA-005 (Canada) payment file.
Statement downloads: make sure online banking lets you download statements as OFX, QFX or CSV files, not only PDF. That is what accounting software imports.
Users and approvals: whether you can give a bookkeeper view-only access, or require two people to approve payments.
A linked savings account for tax money, and a business credit card.

What to bring

Requirements vary by bank, so check its list first. Banks must verify who owns and controls a business account, so expect to show ID for each owner and signer.

United States

Tax ID: the EIN confirmation letter for an LLC, partnership or corporation (see how to get an EIN). A sole proprietor may be able to use their SSN.
Formation documents: articles of organization or incorporation, stamped by the state.
Ownership documents: the LLC operating agreement, or corporate bylaws and a resolution naming who may sign.
A DBA filing if you trade under a name other than the legal name.
Government photo ID for each signer, and details of each beneficial owner the bank asks about.
A business licence, if your city or state requires one and the bank asks for it.
An opening deposit.

Canada

Sole proprietorship: the provincial business name registration (master business licence in Ontario, for example), your ID, and the business number if you have one.
Partnership: the registration, the partnership agreement and ID for each partner.
Corporation: the certificate and articles of incorporation, the business number, a list of directors and of individuals who own or control 25% or more, a banking resolution, and ID for each signing officer.
An opening deposit.

Opening it, step by step

Get the business set up first: structure chosen, entity formed or name registered, and the EIN or business number in hand. See US structures or Canadian structures.
Pick the bank using the questions above.
Book an appointment or start online. Many banks let a sole proprietor or single-owner company open online; multi-owner businesses often need a branch visit.
Open the operating account in the business's exact legal name.
Add a savings account for sales tax, payroll tax and income tax money, so it is not spent by mistake.
Order a business credit card, if you want one, linked to the same bank or another.
Set up online banking: users, approval limits and alerts for large payments.
Make the opening deposit from your personal account. That is your first owner contribution.
Update your payment details on invoices, with payment processors, and with suppliers who collect by direct debit.

Setting it up in your books

Create the account in your accounting software as a bank account, named so you can recognise it (for example "Operating account", not just the bank's name). Add the savings account and the credit card too.
Enter the starting point. For a new account, record the opening deposit as an owner contribution: money moves into the bank account and owner's equity goes up. For an account that already has history, enter the balance on the day you start your books, taken from the bank statement.
Record money moving between accounts as transfers, not income or expense. Moving tax money to savings is a transfer.
Record personal money spent on the business as an owner contribution (or reimburse yourself), and business money spent personally as an owner's draw. Draws and contributions are covered in owner draws vs contributions.
Import the statement each week or month from the bank's download, and match each line to an invoice payment, a bill or a new expense.
Reconcile every month to the statement's ending balance.

The free bank reconciliation template works if you are not yet using accounting software.

Keeping it separate

Pay yourself on purpose. Transfer a set amount to your personal account on a set day, and record it as a draw or, for a corporation, salary or dividends.
No personal spending on the business card, even if you plan to pay it back. If it happens, record it as a draw straight away.
Deposit every business receipt. Cash, cheques and card payouts all go into the business account, not your wallet.
Keep the receipts for every payment, attached to the transaction if your software allows it. See the record keeping guide for how long.

Checklist

Form the business or register the name, and get the EIN or business number
Compare two or more banks or credit unions on fees, limits and statement downloads
Gather formation documents, agreements, ID for each signer and the tax ID
Open the operating account in the business's legal name
Open a savings account for tax money and, if you want one, a business credit card
Set up online banking users, approval limits and alerts
Make the opening deposit and record it as an owner contribution
Create the bank, savings and card accounts in your books
Import and match the statement every week or month
Reconcile every month

In AcboBooks

New AcboBooks companies come with Checking, Savings and Credit Card accounts ready to rename. Transfer Funds moves money between them without touching income or expenses. When the statement arrives, import the bank's OFX, QFX or CSV file and match the lines, then reconcile to the ending balance; the reconciliation report is saved for each month. You can attach receipts to transactions, and they are kept in the Doc Center. The Academy lessons on setting up bank accounts, importing bank transactions and reconciling show each screen. If your bank offers OFX Direct Connect, AcboBooks can download the statement itself; otherwise you download the file from online banking.

Sources and official links

Last reviewed October 26, 2026. Government pages change; if a figure here differs from the official page, the official page wins.

Frequently asked questions

Can I use my personal account for my business?

A sole proprietor legally can, but it makes bookkeeping and tax time much harder and makes an audit painful. For an LLC or corporation, keeping the money separate is part of what protects your personal assets. Open a separate account as soon as you start.

Do I need an EIN or business number to open a business account?

US banks usually ask for an EIN for an LLC, partnership or corporation; a sole proprietor may be able to use their SSN. Canadian banks usually ask for the business number or incorporation documents for a corporation, and the business name registration for a proprietorship.

Is money in a business account insured?

In the US, FDIC insurance covers up to $250,000 per depositor, per insured bank, per ownership category, and accounts of a corporation, partnership or LLC are a separate category from your personal accounts. In Canada, CDIC covers up to $100,000 per eligible category at each member institution. Ask your bank how its business accounts are covered.

Should I get a business credit card too?

It helps. A card used only for business keeps the expenses in one place, and you can import its statement the same way as the bank's. Pay it from the business account.

What do I do about business expenses I paid personally before the account existed?

Record each one as an expense paid with money you contributed, so it increases your owner's equity, or reimburse yourself from the business account with an expense report. Keep the receipts either way.

This article is general information, not tax, legal or accounting advice. Rules and dates change; check the official source or ask your accountant before acting.