For business, open current account with tradename.
Should freelancers use salary account from previous employer to accept business payments?
My wife offers content writing services to U.S.-based clients as a freelancer. She currently accepts the payments from USD to INR in her salary account (HDFC) which was created by her previous employer when was working for them. Currently, she works solely as a freelancer. She has already accepted 18 lacs plus receipts in her salary account in FY 22-23. We have also applied for an individual GST number for her as her receipts would cross 20 lacs. Is it advisable to continue using her salary account to accept payments or should she open a new bank account? What type of account should she open in that case?
Asked 1 year ago in Income Tax
Ok. What kind of issue may she face if she continues to use salary account to accept freelance business payments? What will be the advantage of opening a current account? Will any bank allow her to open a current account as she doesn't have a registered firm. She is just an indivudual. I more elaborate answer would be helpful.
Asked 1 year ago
No it is not advisable to take payment in current account.
It is advisable to open a current account once you have GST number.
Also, it will be easy to get FIRC once you open current account as FIRC would be required for GST purpose.
Also, after a certain point of time if bank observes that you are doing business using salary account it might stop your receipts and ask you to open current account.
Hence, it is better to do it before that.
Hope you find the information helpful, if yes do rate if 5 and provide your valuable feedback for my improvement.
Thank you
Bank might not allow receipts in salary and ask you to convert to Current Account. With current account you can obtain FIRC.
Dear Sir,
Hope you are doing well !!
It is advisable to open current account with trade number.
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