October 23, 2023

Okay, I’m Incorporated. Now What? – My Business Banking

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October 23, 2023

Who does this apply to?

This applies to the newly incorporated business owners who want to minimize their record keeping headaches, understand their current financial foundation, and make business decisions by having separate business banking.

What do I do first?

You open a bank account for the company through which all income and payments will be made (keep your Articles of Incorporation (corporate) and CRA Business Number handy). There are lower monthly cost options available, so don’t feel the need to splash out on the $125 package.

While you’re opening that account, get a business savings account, and apply for your first corporate credit card. It’s a surprise tool that will help us later.

Why am I doing this?

The money earned by the corporation, belongs to the corporation until you take it out as personal income, or in rare circumstances, repayment of a shareholder loan. A savings account will allow you save up for a rainy day, or a HST payment.

Using a corporate credit card to pay for your expenses will make it easier to ensure that you’ve recorded all the expenses and will help build the credit rating of the corporation. This makes it easier to get a loan or line of credit down the road to grow.

Most importantly, your accountant will be able to connect your accounting software to the bank and have a near real time view of what’s going on and give you a heads up about any potential issues. More on the benefits of a regular up to date bookkeeping in another episode.

Can't I just cover expenses personally and lean on the shareholder loan account?

If you do this, you will need to submit expense reports, along with all the receipts in order to make sure that the expenses and HST paid, are properly recorded by the corporation. And this is just like having a corporate bank account, but with extra paperwork and headaches. I guarantee the value of time you spend on this is significantly more than month of banking fees.

And in the case that the CRA audits you, you will be on the receiving end of a large tax bill from denied expenses and HST, an equally large accounting and lawyer’s bills for fighting with the CRA to defend against a potential net-worth audit, and gross negligence penalties. Also, your accountant will not put you on their Christmas card list, and you’ll be lucky to get coal in your stocking.

Ok, you’ve convinced me. What next?


Trust me, you don’t want to find out why this is important. Next, we’ll get your Xero account set up, your bank feeds connected. Finally, we’ll use HubDoc to record your expenses, and match them to the payments in your accounts. Solid, regular bookkeeping is the basis of peace, order, and good governance.

Standard Disclaimer: This is intended to be a guide and not binding tax advice. If you need that, call me.


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Brian K. Hlady

Chartered Professional Accountant

CPA Canada In Depth Taxation

Xero Certified Advisor



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