How to close or switch a UK business bank account online

Closing or switching a business bank account is something many UK businesses encounter at some point. It might be due to high fees, poor service, better offers elsewhere, or changes in the business itself. In fact, 89% of SMEs in one survey were dissatisfied with their banks and considering switching to fintech alternatives. Whether you’re unhappy with your current bank, your business is changing, or you just found a better banking solution, it’s important to handle the transition smoothly.

This guide explains who might need to close or change their business account and when, what parts of the process can be done entirely online (versus when a phone call or letter may be required), and the key steps involved. We’ll cover everything from preparing a pre-closure checklist to the detailed steps of how to close a UK business bank account online, as well as how to switch to a new bank with minimal disruption. By the end, you’ll know the requirements, typical timelines, and common pitfalls to avoid when closing or switching your UK business bank account.

Before You Start – Quick Checklist

Goal: Minimise risks and surprises before taking any action to close or switch your account. Before initiating a closure or switch, run through this quick checklist:

• Online banking access & signatory rights: Ensure you have access to the business’s online banking and that you are an authorised signatory. Banks will only process a closure instruction from an authorised person (e.g. a director or account signatory). If your login or authority is not up-to-date, resolve that first to avoid delays.
• Account balances and overdrafts: Check all account balances. Plan to clear any overdraft or outstanding credit facilities before closure. An account generally must not be overdrawn at closure – you may need to deposit funds or arrange repayment. Also, note any pending transactions (like card payments or cheques) because these need to settle before you close the account.
• Active Direct Debits/Standing Orders: List all regular outgoing payments (Direct Debits for bills, tax, subscriptions, and Standing Orders for salaries, rent, etc.). You’ll need to cancel or move these to a new account before closure to avoid missed payments. Failing to transfer Direct Debits is a common mistake that causes issues later.
• Incoming payments and invoicing: Consider incoming payments from clients, marketplaces, or payment links. If customers or platforms (like Amazon, PayPal, etc.) send money to your old account, make sure to update them with new bank details in advance. Also update any invoices or payment links that contain your old account info, so new payments go to the right place.
• Employee cards and virtual cards: If your team has company debit cards or you’ve issued virtual cards linked to the account, these will be cancelled once the account is closed. Plan how employees will pay expenses during the switch (e.g. using the new account’s cards) to avoid interruptions.
• Integrations (accounting, payroll, etc.): Take note of any software integrated with your bank account – for example, accounting software feeds, payroll systems, or payment gateways that draw from the account. Be prepared to update these integrations with your new account details. You may need to reconnect bank feeds in accounting software and update any saved bank info in payroll or e-commerce platforms.

By checking all the above, you’ll reduce the risk of missing a critical payment or losing access to records when you start the closing or switching process.

How to Close a UK Business Bank Account Online (Step-by-Step)

Not every bank is fully digital when it comes to closures, but many UK banks do allow you to request account closure through online banking or a mobile app. We’ll assume you’re using a bank that supports online closure (or at least an online request) – if not, the steps still apply, but you might end up sending a form or visiting a branch as noted. Below is a step-by-step guide:

Step 1 – Confirm Eligibility and Closure Rules

Before closing, double-check your bank’s specific requirements and definitions of “closure”:

• Minimum service period or fees: Make sure your account isn’t subject to any minimum term or closure fees. Most business current accounts don’t lock you in long-term, but some promotional deals or packages might require a certain period or charge a fee if closed early. Check your contract or ask the bank if any notice period or charges apply for closing the account.
• What “closure” entails: Clarify what the bank will do when closing. Will they simply close the account number, or will they also deactivate your entire online banking profile? For example, if this is your only account with the bank, closing it might also terminate your online banking access. Understand if you’ll still be able to log in to retrieve past statements afterwards. (Some banks allow viewing statements for a limited time after closure, while others don’t.) Example: Barclays defines closing a business account as requiring a form and will shut the account entirely – you must print and post a closure form, and online access will eventually end.

Takeaway: Read your bank’s help pages or call them to confirm any conditions for closure and what the process involves. Knowing these rules upfront prevents surprises (like finding out you needed to give 30 days’ notice or that you lose access immediately upon closure).

Step 2 – Settle Balances, Fees, and Liabilities

Next, ensure the account is fully settled:

• Clear overdrafts and debts: If you have an overdraft or any kind of loan tied to the account, pay it off or arrange a transfer before closing. Banks will not close an account in the red. You may need to transfer money in to bring the balance to zero or work with the bank on a plan. In some cases, if you’re switching to a new bank, the new bank might take on your overdraft facility (more on that in the switching section). Otherwise, you must repay it.
• Pending charges or transactions: Wait for any pending card payments, cheques, or recent transactions to fully clear. If you close the account while a transaction is pending, it may get returned unpaid. For instance, if you made purchases on a business debit card that haven’t settled, or have chargebacks/disputes in progress, it’s wise to resolve those first. Banks often advise ensuring “all outstanding payments have cleared” before closure. This helps you avoid a scenario where a delayed charge comes in after closure and causes a negative balance or complications. In short, let the dust settle: ideally, stop using the account for a few days and confirm there are no pending items before you proceed.

By settling everything, you ensure the account can be closed cleanly at a zero balance. Some banks will actually refuse to close an account until the balance is zero and all fees are paid. It’s much easier to address this in advance than to scramble after submitting a closure request.

Step 3 – Cancel or Move Regular Payments

To prevent interruptions in your outgoing and incoming payments, handle them before closing:

• Transfer or cancel outgoing payments: Identify all Direct Debits and Standing Orders set up on your account. For each one, either cancel it or move it to a new bank account. If you’re switching to a new bank, you can set up the equivalent mandates on your new account (or let the switching service move them automatically if you use it – see switching section). Typical payments to consider are: taxes (HMRC VAT or PAYE direct debits), utility bills, software subscriptions, rent, payroll standing orders, insurance payments, etc. Not doing this is a common mistake – an untransferred Direct Debit will fail after your account is closed, which could mean a missed tax payment or an unpaid bill. So, make a list and systematically redirect each one.
• Handle incoming payments: If clients, customers, or marketplaces (like Amazon, Etsy, eBay) pay into your account, notify them of your new bank details in advance. It’s best to do this well before closing the old account. For key clients, send a friendly notice that you are changing banks and provide the new account details for all future payments. You might also update your invoices and payment requests to show the new account info. For example, one business banking guide suggests emailing all current customers (use BCC for privacy) to inform them of the new account, and also updating the bank details on your next invoice to each client, highlighting the change. This proactive communication ensures that incoming funds won’t accidentally go to the closed account (and if they do, see the FAQ on how switches handle misrouted payments).

Additionally, if you use payment links or have any online checkout connected to your bank (less common for a bank account itself, more for merchant services), update those to point to the new account or a different payment method.

Step 4 – Export Statements and Important Documents

Before closing day, secure all the records you might later need:

• Bank statements (last 6+ years): It’s good practice to download and save your statements and transaction history for at least the past 6 years. UK companies are generally required to keep financial records for six years from the end of the financial year for tax and accounting purposes. This includes bank statements. Once your account is closed, your online banking access to those statements could be limited or removed. Many banks advise getting all statements in advance. If you forget, don’t panic – banks can provide copies after closure, but it can be less convenient. (By law, you’re entitled to request copies of closed account statements for up to five years after closing, but you might have to visit a branch or wait for post.) Save yourself trouble by downloading everything now.
• Closure confirmation and other docs: After you request closure, the bank will typically issue a confirmation (like a letter or email stating the account is closed) and a final closing statement. It’s wise to keep this confirmation document as proof, in case any issue arises (for example, if a debit tries to hit the old account, you have proof it was meant to be closed). You might also want to download any interest certificates, loan payoff letters, or other documents from your online banking. Essentially, assume that once the account is shut, you won’t easily log in again – so grab what you need beforehand. As one guide puts it: “Download all documents and statements for your records. You’ll no longer have access to them when the account is closed.”. Better safe than sorry!

Step 5 – Submit the Online Closure Request

Now it’s time to actually close the account. If your bank supports online or in-app closure, follow their procedure. Typically:

• Find the account closure option: Log in to your online banking or mobile banking app. The closure function is often under Settings, Account Services, or Account Management. For example, NatWest’s mobile app has a “Close this account” option under the account’s menu. In online banking, it might say something like “Close account” or provide a form. If you can’t find it, use the help menu or search “close account” on the bank’s site – many banks let you initiate a chat with support or fill an e-form.
• Fill out the closure form: You’ll usually be asked to confirm the account details and reason for closing, and provide an alternate account for any remaining balance to be transferred to. Fill in all required info. Double-check that you’ve selected the correct account (some businesses have multiple accounts, so ensure you’re closing the intended one).
• Follow any additional steps: Some banks might send a code to your phone to confirm, or ask you to confirm via email. Others might require electronic signatures from all signatories. For instance, if two directors are required to authorise, the app may not allow closure – you might then be prompted to print a form for both to sign. (NatWest notes that if a business account requires two signatures jointly, you cannot close it online – both signatories would have to sign a letter or visit branch instead.)
• Processing time: Once submitted, the closure request goes to the bank’s team. Many banks process closures within a few days. For example, the Co-operative Bank states it can take up to 5 working days to process a business account closure request. Some banks might do it faster (possibly even same-day if everything is in order and no pending transactions). You’ll usually receive a confirmation message or email when the account is closed.

In cases where fully online closure isn’t available, the process is similar but on paper: you might have to download a business account closure form from the bank’s website, fill and sign it, then email or post it to the bank. For example, Barclays requires either a branch visit or mailing in a signed closure form for business accounts, and Lloyds Bank asks customers to email or post a completed account closure form to close a business account. If that’s the case, complete that form carefully (ensure all authorised people sign it) and send it as instructed. The processing time may be similar (a few days after they receive the form).

Step 6 – Verify Closure and Monitor for Late Transactions

After submitting the request, don’t just forget about it. You should verify that the account is indeed closed and watch for any straggling transactions:

• Confirm the account is closed: You should get a confirmation from the bank. This might be an email or letter stating “Your account ending **** is now closed.” If you don’t receive one in the expected timeframe, follow up with the bank. Also, try logging into your online banking – the account should show as closed or may have disappeared from your account list. If it’s still visible but marked inactive, contact the bank to ensure the closure went through. Some banks send a final statement by post showing a zero balance and closure; keep an eye out for that as final proof.
• Watch for any “late” transactions (7–30 days): Even with careful planning, sometimes a transaction sneaks through after closure. It could be a Direct Debit you forgot about or an annual fee you didn’t anticipate. Typically, once the account is closed, any incoming payments will bounce back to the sender and any attempted debits will be declined. However, within the first month after closure, stay vigilant. Check that all your important payments (the ones you moved in Step 3) are indeed happening from the new account. Also verify that clients are paying to the new account. If you did not use the official switching service (which auto-forwards payments), there’s no safety net – so double-check with partners if they accidentally sent money to the old account. Most issues will show up in the first 7–14 days after closure (for instance, missing a fortnightly payment), but to be extra safe, monitor things for up to 30 days. This period gives time for any monthly cycle to reveal itself (e.g. a monthly subscription you forgot). Essentially, treat the first month as a monitoring period to catch and fix any loose ends (“transaction tails”) that might emerge.

If something does come up – say a customer accidentally sends money to the old account – you can usually work with the bank to retrieve it (if it’s closed, the money should bounce back to the sender automatically). And if an outgoing payment was missed, you can pay it manually from the new account once identified. The key is to catch it quickly, which is why a short period of increased vigilance post-closure is wise.

With these steps completed, you should have successfully closed your business bank account. Next, we’ll look at switching to a new account, which often goes hand-in-hand with closure.

How to Switch a UK Business Account Online (Tutorial)

(Now, let’s switch focus to changing banks. This section serves as a switch business account UK tutorial, showing you two ways to switch your business account online.)

If you want to move from your current bank to a new bank, the UK banking system offers a handy tool: the Current Account Switch Service (CASS). This service can switch your business current account to another provider quickly and with minimal effort on your part. We’ll cover using CASS (Option A) and what to do if CASS isn’t available (Option B – a manual switch). We’ll also outline a suggested timeline for switching to ensure nothing is missed.

Option A – Switch Using the Current Account Switch Service (CASS)

The Current Account Switch Service is an industry-wide service backed by UK banks that can transfer your account from one bank to another in 7 working days, guaranteed. Here’s how it works and what it covers:

• Automatic transfer of payments: CASS will move all your regular payments for you. This includes Direct Debits, standing orders and future-dated payments from your old business account to your new account. You don’t have to individually cancel or set them up; the service handles it.
• Redirection of incoming payments: Importantly, CASS sets up a redirection so that any payments accidentally made to your old account will be forwarded to your new account. This is part of the Switch Guarantee: it “catches any stray payments that might be made to the old account” after the switch. For example, if a client forgets and sends money to your old sort code, it will automatically redirect into your new account (and a message can notify the sender of your new details). This redirection lasts for at least 3 years after the switch, per the guarantee.
• Old account closure: As part of a full switch, your old account will be automatically closed on the switch date. CASS transfers any remaining balance to the new account on that day as well. Essentially, day 7 of the switch process is closure of the old account and your new account takes over all activity.
• Timing and reliability: The switch takes 7 working days from the date you choose. You can pick a convenient switch date (perhaps a quiet time in your business’s billing cycle), and as long as it’s at least a week out (and not a weekend/bank holiday), the banks will coordinate to make it happen. The service is free to use and is backed by the Current Account Switch Guarantee, which means if anything goes wrong (like a payment goes astray), the banks will refund any charges or interest lost. Over 40 UK banks and building societies participate in CASS, including all major ones, so chances are your new bank can use it.
• Eligibility: CASS is designed for small businesses as well as personal accounts. According to the CASS criteria, a “small business” for the full switch service is typically one with an annual turnover (or balance sheet) under £6.5 million and fewer than 50 employees (also includes small charities and trusts under that size). Most small and medium enterprises will fit this. If your business is larger (above £6.5m turnover or 50+ staff) or you have more complex banking needs, you may not qualify for CASS – in which case, see Option B below.

Using CASS is straightforward: when you open a new business account at the new bank, tell them you want to switch from your old bank using CASS. You’ll fill in a switch form providing your old account details and pick a switch date. The new bank and old bank then liaise to move everything. For example, NatWest outlines that you apply for the new account, complete a Current Account Switch Agreement form and a Closure Instruction for your old bank, and then the process starts. On the agreed date, your payments move over and the old account closes – all done.

Do note a couple of limitations of CASS:

• It won’t move over any payee details you had saved or any recurring card payments (like those tied to your debit card). You might need to re-add saved payees in your new online banking (some banks can give you a list to help), and update any subscriptions that charged your debit card directly.
• Standing orders with very long frequencies (over annual) aren’t moved, but very few businesses use such schedules.
• If you have a business overdraft at your old bank, you can switch with it, but you must arrange an overdraft with the new bank beforehand for the switch to include it. Essentially, the new bank needs to agree to take on an overdraft facility of at least the amount you owe; otherwise you’ll have to clear the overdraft before switching. (We’ll address overdrafts more in the FAQ.)

Overall, CASS (Option A) is the fastest and least painful way to switch a business account if you’re eligible. It automates the heavy lifting and drastically reduces the risk of missing payments during the transition.

Option B – Manual Switch (When CASS Doesn’t Apply)

If your account or situation doesn’t qualify for CASS – or you choose not to use it – you can still switch banks, but you’ll do it manually. A manual switch means you handle moving everything yourself without the 7-day guarantee framework. Here’s a typical plan for a manual switch:

1. Open the new business account at your chosen bank. This might take some time (for larger businesses, due diligence can be longer, but for small ones it might be quick). Wait until the new account is fully up and running with online access and debit cards issued.
2. Move your payments and balances to the new account step by step. This includes transferring over any standing orders (set them up on the new account), and arranging with suppliers or creditors to switch your Direct Debits to the new account. You’ll need to contact each organisation that was taking direct debits and give them your new bank details (often you can do this online or over the phone with them). Also, transfer any existing balance from the old account to the new one once you’re ready.
3. Update your banking details everywhere: Provide your new account details to anyone who pays you – clients, marketplaces, etc., similar to what we described in the “cancel or move payments” step earlier. Since there’s no automatic redirection in a manual switch, this part is critical. You might choose to run the old and new accounts in parallel for a short period (more on timeline below) to catch any payments you missed updating.
4. Close the old account once you’re confident everything has been switched over successfully. Use the closure process we outlined in the previous section (in this case, you won’t be using CASS to automatically close it, so you must instruct the old bank to close the account directly).

A manual switch is essentially “do-it-yourself” – open new account -> gradually migrate transactions -> close old account. It gives you more control over timing. Some businesses prefer this if, for example, they have multiple accounts or currencies that CASS can’t handle, or they want to test out the new account while keeping the old one open as a safety net for a while.

Who might choose manual switching?

• Businesses that aren’t eligible for CASS (for instance, larger companies, or maybe certain account types like more complex treasury accounts).
• Businesses with multi-currency accounts or foreign currency components – CASS only switches GBP current accounts. If you have EUR/USD accounts, you’ll need a manual approach for those.
• Situations where you have a lot of bespoke integrations or unique arrangements (like a merchant account, payroll feeds, multiple sub-accounts) and you prefer to handle the transition gradually to ensure nothing breaks.
• If you simply want a longer overlap to be extra sure nothing is missed, you might opt out of the one-week switch and do it manually over a month or two.

The downside of manual switching is it’s more work for you and there’s no guarantee scheme. You must be diligent to notify all parties of the new details. However, you can mitigate risk by overlapping the accounts for a little while (keeping the old account open with some funds to cover any straggling payment, until you’re confident all partners have switched to using the new one).

Switching Timeline – Example Plans for 7, 14, or 30+ Days

How long should a switch take? This depends on how many moving parts your business has. Here are example timelines:

• 7 days (Full CASS switch): If you use CASS and have relatively simple finances, the whole switch can be done in one week. This is ideal when you have few regular payments and you trust the system to handle it. It’s the minimum time because CASS itself uses a 7-working-day process. For a manual switch, doing it all in one week is only feasible if you have almost no recurring payments to move or you’re extremely on top of things.
• 14 days (Standard cautious approach): Many businesses opt for roughly two weeks of overlap. In this plan, you open the new account and start the switch (or your own migration) and then allow one billing cycle of most weekly/biweekly payments to pass. Two weeks can catch any fortnightly payments or give you time to double-check that the first payroll or supplier run on the new account goes smoothly. If not using CASS, you might keep the old account funded for those two weeks as backup.
• 30 days (Safe for complex situations): A month-long overlap is a conservative approach if you have many stakeholders or want to see a full monthly cycle through. Over 30 days, you’ll witness all monthly Direct Debits (since most bills hit monthly) and can identify any that you missed transferring. It’s a good buffer for businesses with lots of clients/suppliers to notify. You can keep the old account open (with some money in it just in case) for 30 days after opening the new one. By the end, you should have caught basically all regular transactions. Then you can confidently close the old account.

Some businesses even run two accounts in parallel for a few months, especially if they are not sure about the new bank. This can be costly if the old bank charges fees, but it’s an extra-safe strategy. The trade-off is cost and complexity vs. risk.

Bottom line: Choose a timeline that fits your volume of transactions. With CASS, you don’t necessarily need a long overlap because of the payment redirection safety net. Without CASS, err on the side of a longer overlap to ensure nothing and no one gets missed.

How to Change a UK Business Account Online Without Disruption

Switching banks doesn’t have to mean a halt in your operations. In fact, the best approach is often not to close the old account immediately, but to change over gradually so everything keeps running. In other words, you might want to operate two accounts in parallel for a short period. Here’s how you can change UK business account online in stages to avoid any disruption:

• “Parallel banking” strategy: Rather than viewing it as an abrupt switch-off of Bank A and switch-on of Bank B, consider running both bank accounts for a while. Open your new business account and start using it (especially for new transactions) while the old account is still active for existing payments. This way, there’s no gap – if a payment accidentally goes to the old account, it’s still open to receive it. You only close the old account after a comfortable overlap period (as discussed, 2–4 weeks is common for most, possibly longer for very busy accounts). Many businesses find this dual-account period the most surefire way to catch everything and ensure continuity.
• Updating essential parties with new details: Changing accounts means a lot of info updates. Make a plan to update bank details with all key entities in your business ecosystem. For example:
  • HMRC (Tax authorities): If you have any tax Direct Debits (like VAT or PAYE), update HMRC with your new account details. HMRC asks that you inform them at least 14 days in advance of changing your bank for VAT payments. You can usually do this through your online tax account (for VAT, there’s an option to change repayment bank details, and for PAYE you may need to contact them or update via your PAYE online account). Avoid changing HMRC Direct Debits right around filing deadlines – as they warn, don’t change it in the 5 days around a VAT return due date to prevent duplicate charges.
  • Payroll and pensions: If you have a payroll provider or make salary payments directly from your bank, ensure the payroll system is updated to use the new account. Also update your auto-enrolment pension provider if they pull contributions via Direct Debit. Essentially, any regular payment to employees or HMRC needs to know about the new bank details.
  • Payment providers and marketplaces: Update any payment processors (Stripe, PayPal, Square, etc.) that deposit funds to your bank, as well as marketplaces like Amazon, eBay, Etsy where you have sales payouts. Log in to those platforms and change the bank details on file to the new account so your payouts route correctly. This typically takes effect in a few days after verification.
  • Clients (invoices & subscriptions): Inform your clients – especially those on recurring subscription payments or retainer fees – of your new banking details. As mentioned earlier, an email announcement and a note on your next invoice are good practices. If you have a handful of very important clients, a personal call or message can also reinforce the change. The goal is that by the time you close the old account, all regular customers are comfortably sending to the new one.
• Minimising lost or missed payments: To change accounts without losing any payments, communication and timing are key:
  • Proactively communicate the change to everyone paying you before it happens, and then remind them at least once during the transition (for instance, a week before you plan to close the old account, send a friendly reminder to any who haven’t switched over).
  • Set “deadlines” for yourself – e.g., “By X date, all suppliers will be paying from new account; by Y date, all clients will be paying into new account” – and follow up on any stragglers.
  • Monitor both accounts during the overlap. If you see a payment come into the old account, immediately reach out to that payer with the new details again.
  • After closing the old account, if using CASS, rely on the redirect but still inform senders of the change when you notice a redirected payment.
  • Essentially, be a bit over-communicative for a month: it saves you from the headache of chasing lost funds later. Most partners will appreciate the clarity and professionalism.

By taking a phased approach, you ensure that “business as usual” continues even as you change your banking. No missed payroll, no bounced vendor payments, and no confused customers – they all experience a seamless change because you kept both accounts running and informed everyone in time.

Common Mistakes That Cause Delays (and How to Avoid Them)

When closing or switching business accounts, certain mistakes can lead to delays, extra fees, or headaches. Here are some common pitfalls and how to steer clear of them:

• Leaving Direct Debits behind: One of the biggest mistakes is not transferring or cancelling all Direct Debits before closing the old account. If even one is forgotten, it will try to pull from the closed account and fail. This could disrupt services (imagine your insurance or utility bill not getting paid). Avoid it: Use the checklist to identify every Direct Debit and either move it via CASS or set it up anew on your new account (or cancel if no longer needed). Double-check things like annual payments that are easy to overlook.
• Ignoring pending card payments: If you’ve made recent debit card purchases or have subscriptions tied to the card (rather than the account number), those charges might still be pending. Closing an account while such a payment is in limbo can cause it to bounce or the merchant to not get paid. Avoid it: Check your transactions for any pending items and consider waiting a couple of extra days for them to clear. Also, update any services where your business debit card is on file (for example, online services charging your card monthly) with your new card details, so they don’t try charging a cancelled card.
• Closing during an active dispute or chargeback: Perhaps you disputed a transaction on your account or you’re a merchant dealing with a chargeback. If the dispute process is ongoing, closing the account can complicate the resolution (there may be refunds or credits due). Avoid it: It’s best to resolve any open disputes or chargebacks before switching/closing. If timing is an issue, consult the bank – they might advise keeping the account open until the dispute is settled to ensure you receive any funds due.
• Not securing statements/documents: We mentioned this, but it bears repeating: a mistake is to close the account and then realize you don’t have copies of important statements, loan agreements, or tax documents. Getting them after the fact can slow you down (and possibly cost fees). Avoid it: Download or request all needed records in advance. If you do forget, remember you can request copies for some years post-closure, but don’t rely on that as your primary plan.
• Initiating closure with the wrong authority: If a staff member who isn’t an authorised signatory tries to close the account, the bank will reject or delay the request. Business accounts often require a director or primary account holder’s signature/approval to close. Avoid it: Make sure the request comes from an authorised person on the account mandate. Update your bank mandate if necessary before starting (for example, if a director left and you haven’t updated signatories, do that first). This will save a lot of back-and-forth with the bank.

By being mindful of these issues – transferring all payments, timing the closure right, gathering records, and following proper authorisations – you can prevent most common problems that cause delays in closing or switching accounts.

Compliance & Record-Keeping (UK)

When closing or switching your business bank account, keep compliance and record-keeping considerations in mind:

• Documents to retain (and why): As a UK business, you are legally required to keep financial records (including invoices, receipts, and bank statements) for a number of years. Generally, limited companies must keep records for 6 years from the end of the financial year they relate to (and sometimes longer for specific records or if there are ongoing inquiries). Even if you’re a sole trader, HMRC expects you to retain at least 5 years’ worth of records after the relevant tax year. You should save all bank statements, transaction histories, and any closure confirmation letters as part of these records. These documents might be needed for future tax audits, financial statements preparation, or verifying transactions. Also, if your business is ever subject to compliance checks (e.g. VAT inspections), having the complete bank history is crucial. In short, don’t lose access to your transaction history – store it securely (electronically and/or paper copies). It’s not just good practice; it’s the law to retain them.
• Access to statements post-closure: Different banks handle this differently, so it’s worth clarifying before you close. Some banks allow you to still log in for a while after closure or have a process to obtain statements. For instance, Barclays lets you view statements for up to 5 years after closing an account (via online banking), whereas other banks like NatWest require you to request them via branch or phone once the account is shut. Digital banks (Starling, Monzo) often email you a final statement of all transactions upon closure. Ask your bank how you can get records later. If they offer online access for a period, make sure you keep your login credentials active. If not, plan to request paper copies annually or as needed. It might also be prudent to note down account details (account number, sort code) and the exact closure date and reference, in case you need the bank to locate records in the future. Essentially, treat obtaining records as part of the switching/closing checklist – it will keep you compliant with record-keeping requirements and save a lot of hassle if you need those docs down the line.

By staying organised with your records and understanding the bank’s post-closure policies, you ensure that even after the account is gone, your business remains on solid footing for any audits or information needs.

FAQ

Q: Can you close a business bank account completely online?
A: In many cases, yes, you can request closure online – but it depends on the bank. Several modern banks (like NatWest, Santander, TSB, etc.) allow online or in-app closures via a form or secure chat. For example, NatWest’s app lets you tap “Close account” and submit a closure request digitally. However, some traditional banks still require offline steps. Barclays, for instance, does not offer a fully online closure for business accounts – you must either visit a branch or send in a signed closure form by post. Lloyds Bank similarly asks for a mailed or emailed form. Always check your bank’s procedure: the bank’s help page or FAQ will tell you if an online option exists. If not, you may have to print and sign a letter or form. In summary, online closure is possible with many banks, but not all – be prepared for a few traditional ones to ask for a letter or branch visit.

Q: How long does it take to close a business account?
A: The closure process itself is usually quick once everything is in order, but there’s a difference between requesting closure and it being fully closed. If you have no pending transactions, some banks might close the account almost immediately or within a day or two. In other scenarios, the bank might take a few business days to complete their checks and send confirmation. For example, the Co-operative Bank cites up to 5 working days to process a business account closure request. In practice, many customers see closures finalize in 1–3 days. If there are pending payments or complications, it could stretch longer because the bank may wait for those to clear. To ensure a speedy closure, follow the steps we outlined (clear all balances, stop transactions, etc.). Once the bank has confirmed closure, any remaining balance will be sent to you (or transferred as per your instructions). So, expect anywhere from instant up to a week in normal cases. If it’s been over a week without confirmation, contact the bank to follow up.

Q: What if the bank requires a signed letter to close the account?
A: Some banks do insist on a signed request. If that’s the case, you will need to write a formal closure letter or fill out their account closure form. The letter/form typically needs: the business name and address, the account number and sort code of the account to close, a statement that you wish to close the account, instructions for what to do with any remaining balance (e.g. transfer to another account or send a cheque), and the signatures of all required authorised people. For example, if two directors are required to sign on the account, both must sign the closure letter. The bank may have a template or downloadable form – always use that if available, as it will prompt you for all necessary info. Once completed, send it to the address provided (recorded delivery is wise for postal letters) or via the official email if they allow scans. Keep a copy for your records. After sending, you might get a call or email confirmation from the bank, or you may need to follow up. While it’s an extra step, treat it as a formal administrative task – ensure the letter is on company letterhead (if they require), dated, and worded clearly. Then the closure should proceed in a few days as if you had done it online.

Q: Can you switch a business account if there’s an overdraft outstanding?
A: Yes, you can switch business accounts with an overdraft, but it requires planning. Under the Current Account Switch Service, your overdraft can be transferred as part of the switch if your new bank agrees to take it on. This means before initiating the switch, you should talk to the new bank about setting up an overdraft facility on the new account. They’ll assess your credit and decide how much they can offer. If they approve an overdraft at least equal to your old one (or the amount you owe), then on switch day, your overdraft debt will effectively move to the new bank (your new account will start with that negative balance, and your old one will be closed). If the new bank won’t offer an overdraft or enough of one, you should pay off or reduce the overdraft on the old account before switching. Banks will not let you simply abandon an overdraft – if you tried to switch without addressing it, the switch could be stalled or you might end up with the old account not closing. NatWest’s guidance on switching with an overdraft is: yes, you can, but discuss an overdraft facility with us first. So, in summary: it’s possible to switch with an overdraft, but you either need the new bank to cover it or you need to clear it. Don’t forget to factor in any interest or fees on the overdraft in your plan as well.

Q: What happens to incoming payments sent to my old account after I switch/close?
A: This depends on whether you used the official switching service (CASS) or not. If you switched using CASS, then any payment sent to your old account will be automatically redirected to your new account for at least 3 years after your switch. The sender might be notified of your new details, but the key point is you won’t miss the funds – the system catches it. This covers things like customers who forgot to update your details or even random refunds going to the old account. The Current Account Switch Guarantee promises that all incoming and outgoing payments will be redirected correctly, so you have a safety net. If you closed the old account without using CASS (i.e. a manual switch or just closing outright), then there is no automatic redirection. In that case, any payment to the old account number will typically be returned to the sender with an “account closed” message. The sender then knows to contact you for correct details. This is why it’s so important to inform everyone of the change in advance. If despite your efforts someone sends money to the closed account, they should get it back (returned to their account) and ideally will reach out to you. You can then give them the new account info and ask them to resend to the new account. It’s a bit of hassle, which is why CASS is convenient. As an extra tip, some banks outside of CASS offer a partial switch that might include a grace period of redirection, but it’s not standard or guaranteed. So, assume no redirect unless you’re in CASS. Always double-check your major payers have your new details. If you want belt and braces, leave the old account open with minimal funds for a few weeks (if you can) and monitor it for any surprise deposits, then manually handle those.

Conclusion

Closing or switching a business bank account in the UK might seem daunting, but with proper planning it can be a smooth process. To recap:

• “Close” vs “Switch”: Closing an account simply means ending your relationship with that bank (useful if you’re shutting the business or no longer need the account). Switching usually implies closing the old account and moving to a new provider. If you are moving to a new bank, using the switch service (which includes automatic closure of the old account) can save time. If you’re just closing without a new account, focus mainly on winding things down and keeping records.
• Recommended approach for most small businesses: Open your new account first, and run two accounts in parallel for a few weeks (2–4 weeks is often plenty). This way, you ensure all payments have transitioned. It’s like a safety overlap that greatly reduces the risk of missed transactions. After that period, close the old account once you’re confident everything (and everyone) is using the new account.

Next steps / CTA: Finally, to help you further, we at Sends.co have prepared additional resources for a hassle-free transition. You can download our Business Account Switch Checklist – a handy list to track all the places you need to update your bank details (from HMRC to clients). We also offer a template notification letter/email you can use to inform clients or suppliers about your change of banking details. These free tools can save you time and ensure you don’t overlook anything during the switch. Changing your business bank account is a big task, but with the right guide (and checklist in hand), you’ll handle it confidently and keep your business finances running without a hitch.