All foreign companies can open a company bank account as part of the company formation process once the newly formed LLC has been registered, leased a workplace with an address, and certified by the municipality. Although bank opening procedures vary by bank, the Oman banking industry standards are
highly regulated and require a great deal of paperwork, bureaucracy, notarised and attested documents, and so on. With smart PRO, we will collaborate closely
together with you and the banks to ease and expedite this complex process.
A corporate bank account, also known as a business bank account, refers to a bank account that a business uses to hold its money. Businesses and organizations use corporate accounts for investment and saving purposes and their day-to-day banking needs. Regardless of the size of your business, having a business bank account is essential for all business owners.
A corporate bank account can be opened by any type of business organization or entity, including a sole proprietorship, partnership, or a private limited company. A business will need clear approvals from its board of directors through a corporate resolution to open a corporate bank account.
Advantages in opening a corporate bank account
Financial & Personal Liability Protection.
All businesses and corporations are considered to be separate legal entities from their owners and shareholders. Therefore, if you have a corporate bank account and your business ends up failing, you are protected from being held personally liable for any profit loss. Moreover, simply keeping all your business dealings separate from your personal finances adds a layer of protection to your personal funds and business as a whole. This means that you won’t be held liable, and neither will your assets be taken away if your business goes into debt.
Maintains a Professional Image.
Regardless of who you communicate or contract with as a business, a business bank account makes your business look more professional. You are likely to get better deals when contracting with suppliers and vendors when you use a corporate bank account as it looks more professional and makes your business more reputable. Clients and employees are also more likely to trust you as a business if you process and receive payments through a business bank account.
Simplifies Tax Returns.
A separate business bank account is useful and convenient when completing tax returns as you can clearly see your income and expenses. This way, you avoid mixing up personal and business spending and provide an accurate tax return. Additionally, if you ever have to provide your bank statements to anyone or any authority, all your business financial information is kept separate from your personal transactions.
Personal Accounts Have Restrictions.
Personal bank accounts often have specific requirements regarding using your bank account when you sign up with them. There may be restrictions on using your personal bank account to make business transactions, especially when direct debits and receiving cash payments from customers, this is a huge risk that you can avoid by keeping your business expenses separate by using a business bank account.
Helps Build Business Credit Rating.
Having a separate corporate bank account builds your company's credit score.
If you don’t have a business account, you will have to rely on your personal credit rating, which can sometimes complicate things when looking to secure a loan or company credit. Banks are more lenient when granting loans to corporate bank accounts, especially if they have a good credit rating. By consistently using your corporate bank account for all transactions, you slowly build a credit history.
Access to Business Account Benefits & Exclusive Offers
When you first create a corporate bank account, many banks will have introductory offers on corporate accounts. Through such offers, you can get a good deal with free banking for a certain period of time or you can use banking services at a lower price. Other benefits include free or low-cost electronic transactions and better interest rates on business profits.
Better Business Organization & Management
Managing spending and budgeting is more convenient when a business has a separate bank account. It is more convenient because all reports and bank statements only include your business and no other finances. This not only adds clarity but also makes it easier to show the true financial position of your business when making a pitch to an investor.
