Limited Company Credit Cards: 9 things you need to know

Best Limited Company Credit Card

Here we look in some detail at your options when it comes to Limited Company credit cards, and LLP credit cards. We will answer the most commonly asked questions.

We will cover the difference between company and personal credit cards and answer things you want to know about eligibility checks, interest free cards, using a personal credit card for limited company expenses. Which company cards have the best benefits, and which corporate credit cards will get you air miles etc.

Also, we will tell you which one we think is the best credit card when we compare the top card providers currently in the UK.

Limited Company Credit Cards

1. What is the difference between a personal and company credit card?

There is one key difference from a personal card and that is it is not your own personal credit history and credit score that will determine if you get accepted for the card or not and what credit limit, they offer you.

It is therefore the company credit history that is the main determining factor.

2. Using a company credit card for personal use

This should be avoided if possible. Corporate credit cards are for business use plain and simple. If you read the terms and conditions of most corporate cards you will find that you are in breach of the terms by doing this.

The card company will more than likely cancel the agreement if they found out.

3. Using a personal card for business purposes

The opposite way round to number two above and less problematic. It is perfectly acceptable to use your own card for things like expenses. Then you would just claim the money back in the normal way.

4. Business credit cards: No credit check UK

This is unrealistic to hope for. Who would you expect to give you a line of credit without any form of checks involved? At the very least they need to know that you are who you say you are. They need some reasonable chance that you can afford to repay any borrowing.

If you are concerned about you or your companies credit history this is what you need to do.  

Ideally you should apply initially for a business company credit card with a provider who only does a “soft credit check” initially.

A soft check means that it will NOT show on your or your companies credit history. They do an initial light touch check and from this can usually say yes or no.

That means that you get to find out if you will be accepted or not, without adding another credit search entry that will show up on your credit history.

See here for a great soft credit check option.

5. Business cards: Eligibility criteria

OK so there are lots of different card providers and although one or two may have their own quirks here is a pretty standard list of things required.

They’d want to know the following: What type of business is it and how long has it been going? They will ask for your companies turnover or projected turnover for the year. They will want to do a personal credit check on you also.

6. Which corporate cards get you air miles?

These sort of special offer deals are liable to change but some of the cards currently with air miles etc are…

The British Airways American Express® Accelerating Business Card. With this you can earn both “Avios” and “On Business” points for your business and travel spend. Annual fees with this card are chunky though. Over £2,000 as of Feb 2021.

Our preferred option is Capital on Tap Business Rewards Credit Card which is just £99. You can earn unlimited Avios or cashback on all your card purchases. You get up to 1% cashback or 1 Avios for every £1 you spend. You’ll also get 10k bonus points if you spend over £5k over a quarter.

See more details and get a free £75 bonus when you sign up if you use the promotional code: 2REFC237G71 here: Capital on Tap.

7. Best Limited company credit cards

We mentioned the Capital on Tap card above for its great rewards programme and the benefits it offers you. (one point for every £1 you spend using the card)

That is the paid option and has a £99 fee if you want to opt for it. However, in our view for most companies, we feel the standard card they offer is the better deal.

When you apply for a Capital on Tap card you have two options you can either go for the “Business rewards credit card” for £99 or their normal “business credit card” which is totally free of charge.

The free option (no application fee, or monthly or annual charge) has up to £100k credit limit, up to 56 days interest free on card spending, no FX or ATM charges in the UK and the ability to have ten free extra cards for staff, directors etc.

That’s actually a very good deal for a standard business credit card. The Business rewards option has everything that the standard card has plus the rewards and you can get up to 20 additional cards for staff.

Both cards will credit your account with a free £75 bonus if you use the promotion code: 2REFC237G71 when you sign up. The £75 is credited to the card account after your first purchase.

LINK HERE.

8. Interest free business credit cards

It is standard practise that no one gets charged interest on card purchases these days so long as you pay your balance in full. This means you are getting interest free credit and the safety of making purchases via credit rather than debit card.

Credit cards offer far more protection against fraud etc, so that why you should use them for all purchases.

Withdrawing cash is another matter though. If you want cash from an ATM then you should use your company debit card to avoid paying interest.

9. High street bank business card options

Here we look at some of the high street options for business credit cards. The title of this section says “bank”, but we look at one or two building society ones also.

ProviderPurchase Int RateFeesRepresentative APR
Lloyds business credit card16.3%£32pa22.4%
HSBC15.9%Yr 1 0, Yr 2 £32pa22%
Bank of Scotland17.57%£32 pa22.4%
Amazon Business21.9%Yr1 0, Yr2+ £50pa32.6%
*Correct Feb 2021   

Summary

Over the years I’ve been a sole trader, in a partnership and owned and run limited companies. As I know so many people in the blogging and eCommerce industry, I’m often asked about company finance issues in general.

Over the last year or so I’ve been asked lots of specific questions about company credit cards for self-employed people and limited companies.

I thought therefore that it might be useful to actually produce my answers in this post, so that others can use it for reference.

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