Separating your personal expenses from business expenses is important.
There are two main reasons for this. Keeping business expenses apart from personal costs makes them clearer and easier to manage. Plus, you know exactly what is coming in and out of your business.
Using a credit card for business expenses is one way of making sure you deal with business expenses separately. In this article you’ll see the best credit cards for business expenses and what alternatives there are.
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Using personal credit card for business expenses
You may find it easy to get a personal credit card. There are also some great deals available including interest free periods. However, using personal credit card for business expenses UK isn’t a good idea.
There are three main reasons why this is the case:
- If you’re running a limited company, you could be held responsible if you don’t keep up with payments on purchases you made for your business.
- Although initial interest rates may be good, they don’t stay that way.
- Using a personal credit card to buy items for your business makes it harder to separate business expenses from personal expenses.
How do business expenses cards work?
Expense cards are a type of business credit or debit card. These cards give you and your employees greater flexibility when making business purchases. Using business expense cards gives you access to tools such as:
- Setting spending limits.
- Monitoring spending for each card.
- Linking cards with your business accounting tools.
Business expenses cards: types and differences
There are three types of card you can use for business expenses. These three types are prepaid cards that you can top up with a set amount, credit cards with an approved credit limit, and debit cards with funds coming from your business bank account.
The table below shows the comparison between these cards.
| Prepaid expense cards | Expenses credit cards | Expenses debit cards |
|---|---|---|
| Spending comes from a prepaid balance on the card that you can top up | Spending comes from an agreed credit limit | Spending comes from your business bank account balance or your agreed overdraft |
| Some fees may apply | Fees are likely to apply | No fees apply unless you exceed the amount in your business bank account or your agreed overdraft limit |
| Simple application process with no credit checks | Business credit cards can be hard to get. The application process includes a credit check | Comes with your business bank account |
| Does not build your business credit rating | Builds your credit rating but can be damaging if you don’t make payments on time | Does not build your business credit rating |
| Expenses can be controlled | There’s a spending limit but there’s a danger of creating debt if you don’t make payments on time | There’s a spending limit but charges can be expensive if overspends happen |
Using credit cards for business expenses: pros and cons
Using a credit card for business expenses may be a good move for your business if you manage its use in the right way. However, credit cards aren’t alway a good fit so taking time to make the right choice is important. You’ll find some pros and cons below to get your started with your decision making process.
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Alternative to business credit cards: Wise Employee Expense Cards
If you’re looking for an expense card for employees, Wise Employee Expense Cards are simple to use and help you control the expenses for your business. The features of these cards include:
- Transparent fee of £3 per expense card for employees.
- The facility to pre-set spending limits and control access to cards.
- Reduced costs for international transactions as you get the mid-market exchange rate when you pay bills or expenses in foreign currencies.
- The ability to pay in-store or online in more than 200 countries using more than 55 currencies.
- 1% cashback on purchases.
Discover how Wise can help youmanage business expenses 💰
Best credit cards for business expenses in the UK
In the list of best credit card for business expenses below, you’ll find cards to consider based on points such as annual percentage rate (APR), interest rates, withdrawal fees, foreign transaction fees, and cashback or rewards.
Cashplus credit card
You can use the Cashplus credit card at around 26 million locations globally. You can apply if you’re the director of a limited company registered with Companies House, reside in the UK and are 18 or over, and haven’t had a CCJ or IVA against you recently.
Cashplus has 7,971 reviews on Trustpilot with 54% of reviews at the highest level of 5 stars and 30% of reviews at the lowest level of 1 star.
| Features | Fees |
|---|---|
| Services¹ | Cashplus is regulated by the Financial Conduct Authority (FCA). Services that come with this card include:
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| Annual percentage rate (APR)¹ | Representative APR 29.9% (variable) dependent on circumstances |
| Interest rates¹ | Interest rates as low as 19.9% dependent on circumstances |
| Withdrawals fees² | £3.00 |
| Currency exchange rates² | 2.99% |
| Cashback or rewards¹ | 1% cashback |
Capital on Tap
To apply for this credit card you must have a business registered with Companies House as a private limited company (Ltd) or limited liability partnership (LLP). You must also have no unsatisfied CCJs against you. Your business turnover must be at least £2,000 per month.
The basic account has no annual fee and gives you control of your business expenses in real time. The Business Rewards account costs £99 per year and includes bonus points and additional redemption options.
Capital on Tap has 10,407 reviews on Trustpilot with 89% of reviews at the highest level of 5 stars and 4% of reviews at the lowest level of 1 star.
| Features | Fees |
|---|---|
| Services³ | Once you have this account you can:
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| Annual percentage rate (APR)³ | Rates as low as 13.6% APR (variable) dependent on circumstances |
| Interest rates³ | Rates as low as 13.6% (variable) dependent on circumstances |
| Withdrawals fees | FREE |
| Currency exchange rates | FREE |
| Cashback or rewards⁴ | 1% cashback Exclusive offers including savings at Dell, Hertz, and Hotels.com |
Barclays
Barclays is a well-known and trusted name in UK banking. Choose Barclays, and The Select Cashback credit card is one of three credit cards you can apply for. It gives you a fast and convenient way to manage purchases in your business. It’s also a good choice if you trade overseas as benefits include FX savings and cashback on travel and trade.
Other credit cards you can choose from at Barclays are the Premium Plus credit card and the Select charge card.
Barclays has 7,866 reviews on Trustpilot with 8% of reviews at the highest level of 5 stars and 86% of reviews at the lowest level of 1 star.
| Features | Fees |
|---|---|
| Services⁵ | Features of the Select Cashback credit card include:
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| Annual percentage rate (APR)⁵ | Representative APR 21.9% (variable) |
| Interest rates⁵ | Representative 21.9% variable |
| Withdrawals fees⁶ | 2.99% |
| Currency exchange rates⁷ | 2.99% |
| Cashback or rewards⁵ | 3% cashback uncapped for 3 months then 1% cashback. Exclusive business rewards discounts |
American Express
American Express is a well-known global brand. To apply for the American Express Business Gold Card you must be at least 18 years old, have a permanent address in the UK, have a business bank or building society account, and be prepared to pay fees after the first twelve months.
Other American Express cards you can consider are the American Express® Business Platinum Card, British Airways American Express® Accelerating Business Card, Amazon Business Prime American Express® Card, Amazon Business, and American Express® Card.
American Express has 2,896 reviews on Trustpilot with 16% of reviews at the highest level of 5 stars and 75% of reviews at the lowest level of 1 star.
| Features | Fees |
|---|---|
| Services⁸ | When you get this account you pay no fees for the first twelve months. After that, the annual fees are £175. For this fee you get:
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| Annual percentage rate (APR)⁹ | APR of 18.49% - 26.49%, representative based on circumstances |
| Interest rates⁹ | 18.49% - 26.49%, representative based on circumstances |
| Withdrawals fees¹⁰ | 3% of the amount withdrawn with a minimum charge of £3 |
| Currency exchange rates¹¹ | 2.99% |
| Cashback or rewards⁹ | Reward points and access to exclusive business rewards |
Natwest
The business credit card from Natwest is for holders of a NatWest Business Banking account whose business has a turnover of up to £2m. There’s no annual card fee for the first twelve months and no fee after that if you spend £6,000 or more annually. You get a minimum credit limit of £500 and a maximum limit that’s subject to status.
Natwest has 4,545 reviews on Trustpilot with 8% of reviews at the highest level of 5 stars and 86% of reviews at the lowest level of 1 star.
| Features | Fees |
|---|---|
| Services¹² | The services you get with this card include:
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| Annual percentage rate (APR)¹³ | Representative APR of 24.3% |
| Interest rates¹³ | Representative purchase rate of 16.9% |
| Withdrawals fees¹⁴ | 3% of the transaction amount with a minimum charge of £3 |
| Currency exchange rates¹⁴ | 2.95% |
| Cashback or rewards¹⁵ | Access to Business Savings from Mastercard for eligible cardholders. This program gives rebates on items and services that can help your business |
Manage expenses with Wise Business
You can efficiently manage your business spending with an easy to use Wise account. The functionality of the account helps you keep track of your business spending.
You get access to expense cards for your employees, so you know exactly what is being spent. Plus, you get 1% cashback on Wise business cards. Overall, using a Wise Business simplifies your business expense management, so you can spend more time on other areas of the business that need your attention.
Get started with Wise Business
Efficient management of your business expenses is essential. To make sure this happens, you should keep your personal and business expenses separate. Using a business credit card is one way to do this. You can also use prepaid expense cards or a business debit card. If you decide to apply for a business credit card, choose one that best suits your needs. Pay attention to the features of the card that are most important to you, such as APR, foreign exchange rates, and rewards, and use this information when making your choice.
Sources:
Sources last checked January 27, 2023
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