Home Forums Money matters how does a 16 yr old get a bank ‘business account’

  • This topic is empty.
Viewing 7 posts - 1 through 7 (of 7 total)
  • Author
    Posts
  • #1000278
    boots72
    Member
    • Total posts: 14

    Hi
    As a 16 yr old with my new business setting up as a sole trader, early enquiries with banks – appears may be difficult to get a business account – bank account as a 16 year old.
    Does anyone have the answers to navigating this…… whilst noting I’m a sole trader…..

    #1223690
    bb1
    Participant
    • Total posts: 4,472

    [USER=34537]@LucasArthur[/USER] is the banking guru here, any suggestions Jason

    #1223691
    LucasArthur
    Participant
    • Total posts: 3,158

    Howdy

    Been a while :), although IMO being under 18 has some downfalls when it comes to opening a business bank account with the pillars – especially as a sole trader. In most situations, there was generally a guardian involved.

    There are numerous reasons why, justified or not, although it generally has a lot to do with the ability to enter into commercial agreements and being sub 18 prevents you from signing contracts (albeit very meager ones) that forms part of the agreement when opening a commercial (business) account as such.

    Hare you asked the banks you are interested in about the best way to approach this? They may say guardian/partner etc 18+ and then when you hit 18 remove them?

    As a side note, bravo for this move – dont let it sway you, the banking that is… and as a sole trader, you can operate under your own account if you want anyways as its the same legal entity – just dont get your biz name on the deets though :(

    Cheers
    Jason

    #1223692
    boots72
    Member
    • Total posts: 14

    Hi Jason,
    Thanks for your reply. When you say “as its the same legal entity – just dont get your biz name on the deets though “ …..
    Can you elaborate please
    Do u mean don’t have my business name on the banking account application…..

    #1223693
    Paul – FS Concierge
    Moderator
    • Total posts: 3,115

    FURTHER INFORMATION FROM THE ORIGINAL POSTER PREVIOUSLY POSTED IN A DIFFERENT THREAD – SUBSEQUENTLY REMOVED FOR DUPLICATION REASONS:

    My son is feeling a little defeated & I don’t know what to do

    As an offshoot of his year 11 schooling – business subject – My16 yr old is setting up his own little small ecommerce business as a sole trader, ABN, Business name, Domain name, bank account all already set up in his name, stock ordered from overseas manufacturer.

    Now the ROADBLOCK – (critical sales platform) ebay & paypal will not let him have an account unless he is 18yrs of age.

    My accountant suggested that I ask the bank for a bank account where the bank account is in my name (adults name) ie: Joe Bloggs as trustee for Junior Bloggs ….. trading as xxxxxxx (business name). with his TFN and the ABN…..
    – Then I as the adult can basically setup the Ebay & Paypal account linked to the trustee bank account that’s created in my (adults) name.
    The bank has advised its not that simple.

    That I would need to get Trustee certification…..? (a whole new world to me)
    that would apparently likely involve me as the adult becoming the sole trader?? ie: having to ask asic to change the sole trader – business name from my sons name to me?
    Likewise the ABN to me…. etc etc

    Then I can get a trustee certification?? where my son is the sole beneficiary.
    Go back to the bank – the bank can setup the account in my name as trustee for my son….
    All this for his little business that may only make a few hundred dollars or a few thousand, besides that
    My son is determined and I don’t want to crush his enthusiasm and dreams!!

    Q.1. Is this the correct / best process to navigate thru…….
    Q.2. How much would it likely cost to set up a trustee certificate?….
    Q.3. With myself having to become involved – what taxation effects could be impacted… (as I already have a job) or as he being the sole beneiciary does that allow taxation at his rate and in turn he can reinvest his monies made back into his little business
    Q.4. With myself involved – are my assets now open / unprotected – if someone was to sue the business…..

    #1223694
    LucasArthur
    Participant
    • Total posts: 3,158

    Based on the above info – and being only a sole trader, just open a seperate bank account (your son) and operate the business under that… everything else is irrelevant, unless he wants to have a cheque with business Name or other… might be overthinking it to be honest, considering the comment is about a few hundred or thousands of dollars.. however, if he is importing goods from OS – suggest do it right from the outset as insurances will be required – both you and son should sit in front of your accountant where your hands can be completely exposed to get best direction suited to all involved – taking into account concerns, protection etc etc

    #1223695
    LucasArthur
    Participant
    • Total posts: 3,158
    boots72, post: 270377, member: 118255 wrote:
    Hi Jason,
    Thanks for your reply. When you say “as its the same legal entity – just dont get your biz name on the deets though “ …..
    Can you elaborate please
    Do u mean don’t have my business name on the banking account application…..
    Being a sole trader, the person (your son) is the owning entity as a registered business is not an entity unto its own.. IT can’t own anything, your son does… if it was a trust/company with a business name, that’s different as they are legal entities with rules and regs governing them.
Viewing 7 posts - 1 through 7 (of 7 total)
  • You must be logged in to reply to this topic.