Can You Get A Business Credit Card Without A Business?

Enterprise bank cards supply some distinctive perks you possibly can’t all the time get with private bank cards, together with larger sign-up bonuses and specialised rewards classes. However are you eligible to get a enterprise card for those who work for your self as an unbiased contractor, freelancer or when you’ve got an occasional aspect hustle?

Usually, the reply is sure. To be authorised for a enterprise bank card, you simply should be incomes some cash independently. Right here’s what you must find out about making use of for a enterprise bank card once you don’t have a standard enterprise.

Qualifying work for a enterprise bank card

You could be extra of an entrepreneur than you assume. Any income-producing endeavor may be thought-about a authentic enterprise for a enterprise bank card. Only a few examples of widespread nontraditional enterprise ventures embody:

• Working a dog-walking enterprise in your neighborhood
• Shopping for and promoting on eBay
• Working as a digital assistant
• Driving for ridesharing apps like Uber or Lyft
• Proudly owning and leasing rental properties
• Delivering meals with app-based firms like DoorDash or Grubhub
• Tutoring children in particular person or on-line
• Shopping for and promoting antiques
• Unbiased consulting work
• Promoting selfmade objects at markets or on-line (similar to on Etsy or Fb Market)
• Working as an entertainer
• Freelance writing and enhancing
• Constructing web sites
• Managing social media websites

In brief, for those who earn cash from the work you do, you could possibly qualify for a enterprise bank card. You don’t should have a registered LLC or company to use for a enterprise bank card. If on the bank card software you come throughout a piece asking on your “enterprise tax identification quantity,” you possibly can record your self as the only real proprietor and enter your Social Safety quantity as an alternative of a tax ID quantity.

Enterprise bank card necessities

If in case you have a registered enterprise, together with an LLC, you’ll apply for a brand new enterprise bank card utilizing your corporation info. This consists of utilizing your Federal Tax ID quantity, additionally known as an Employer Identification Quantity (EIN). If you happen to run your corporation with out a formal enterprise setup, you possibly can merely apply as a sole proprietor along with your Social Safety quantity as an alternative.

Both method, put together to submit the next info*:

• The authorized title of your corporation and the enterprise title you need listed on the cardboard (this may increasingly simply be your title for those who’re a sole proprietor)
• Your annual enterprise revenue
• Month-to-month enterprise bills
• The age of your corporation since inception
• The trade your corporation is in
• The enterprise construction (LLC vs. company vs. sole proprietorship, as an illustration)
• Your position within the firm
• What number of staff you could have (if any)
• Your corporation tackle, even when it’s your property tackle
• Your corporation cellphone quantity, even when it’s your private cellphone

*Word that not all of this info could also be required by the bank card issuer on the time of software.

Relying on the cardboard, you’ll have to mail in supporting paperwork to show you could have a enterprise. This will embody info from the Inner Income Service that proves your Tax ID quantity or revenue info. In most circumstances, although, you’ll obtain discover of approval inside a number of seconds of making use of on-line.

Are you able to get a enterprise card with out enterprise revenue?

Sure, you may get a enterprise card if your corporation hasn’t but generated any revenue. Issuers perceive that new companies could not have enterprise revenue but, so be trustworthy for those who’re simply beginning out and haven’t generated revenue. That stated, even when your revenue appears small – you’ve solely bought a number of hundred {dollars} price of products, as an illustration – you must record that revenue in your software.

Bear in mind, getting authorised for a enterprise bank card might not be as troublesome because it appears. Many actions may be thought-about a small enterprise. If you happen to recurrently carry out providers or promote objects for a revenue and may show that you’ve got each gross sales and bills, you could possibly qualify for a enterprise bank card. Small companies can embody something from working an energetic Etsy retailer to driving for rideshare firms.

Why get a enterprise bank card as an alternative of a private bank card?

There are a selection of causes to acquire a enterprise bank card for your corporation, together with the next:

Rewards on enterprise bills

Likelihood is you could have some business-related bills you can be incomes journey rewards or money again on. For instance, as a rideshare or supply driver, you could have to cowl your personal fuel in addition to pay for the upkeep and repairs in your car. If you happen to’re promoting crafts or paintings, you’ll most likely have to buy provides.

No matter your prices are, you possibly can earn money, factors or miles if the cardboard has a rewards program. If the account affords a sign-up bonus to new cardholders, you could possibly earn extra rewards by assembly a minimal spending requirement throughout the first few months of account opening.

Maintain private and enterprise spending separate

Sustaining separate enterprise and private bank cards will help you keep organized. Not solely will you could have a greater deal with in your spending, however having all your bills on the enterprise bank card will assist when it’s a must to reconcile your books and pay your taxes.

Construct your corporation credit score rating

Whereas your private credit score rating is taken into account once you apply for a enterprise bank card, you create a enterprise credit score historical past when your credit score issuer furnishes information to the three main industrial credit score bureaus — Dun & Bradstreet, Equifax and Experian.

By retaining your accounts in good standing, your corporation credit score rating will enhance over time, rising your eligibility for different enterprise credit score merchandise sooner or later.

Enterprise perks

Lots of the prime enterprise bank cards supply specialised perks, similar to cellphone insurance coverage and money credit for business-related services and products. It pays to get the proper card on your enterprise.

Can you employ a enterprise bank card for private bills?

Utilizing a enterprise bank card for private expenditures isn’t in opposition to the legislation; nevertheless, doing so could violate the phrases in your card settlement, which might lead to penalties. These repercussions may embody:

• Closure of your account: You’ll doubtless should signal an settlement vowing to not use your corporation bank card for private expenses. The settlement could stipulate that for those who violate these phrases, the issuer can select to cancel your card.
• Private legal responsibility: Mixing your private and enterprise funds could lead to you assuming private accountability for any enterprise money owed within the occasion of authorized problems. It might allow courts to ignore the separation between you and your corporation, doubtlessly holding you personally accountable for your corporation’s obligations.
• Tax penalties: Sometimes, enterprise bank cards entail elevated charges and rates of interest in comparison with private playing cards. However these greater prices usually include a profit: most curiosity expenses and costs accrued from enterprise transactions are tax-deductible, alongside the business-related bills. Conversely, private purchases lack this tax-deductible benefit, leading to no monetary return. So, for those who make the most of your corporation bank card for private bills and carry a stability, it’ll doubtless incur better long-term prices.
• Results on each enterprise and private credit score scores: Utilizing your corporation bank card for private transactions in hopes of enhancing your client credit score rating is likely to be engaging, however it’s unlikely to be useful. Most enterprise bank cards solely report optimistic card exercise to enterprise credit score bureaus, which means any accountable habits with your corporation bank card is unlikely to mirror in your client credit score rating. Nevertheless, issuers do typically report unfavourable enterprise card exercise to non-public credit score bureaus, so your private credit score rating could possibly be adversely affected.
• Restricted client protections: Utilizing a enterprise bank card as an alternative of a private one might end result within the lack of particular authorized protections you get pleasure from once you use a client card — together with safeguards in opposition to sudden rate of interest hikes with out prior discover, prohibition of rate of interest will increase on excellent balances, prohibition of curiosity expenses on well timed paid money owed and allocation of funds towards balances with the best rates of interest first.

If you happen to mistakenly cost a private expense to your corporation card, notify your accountant or bookkeeper and mark the transaction to exclude it from your corporation’s monetary information.

What to look out for in a enterprise bank card

Though enterprise bank cards present loads of benefits, there are a number of potential downsides. Usually, the enterprise bank cards with essentially the most perks cost excessive annual charges. For instance, The Enterprise Platinum Card® from American Specific comes with a hefty $695 annual charge. However for those who’re uncertain how usually you’ll be charging purchases to your card or whether or not you’ll actually use the perks, take into account a enterprise bank card with no annual charge.

Earlier than making use of for a card, take into account the professionals and cons of a number of of one of the best enterprise bank cards so you possibly can resolve which greatest meets the wants of your distinctive enterprise — whether or not your work entails street journeys, inventive work, e-commerce, air journey or one thing else.

In fact, each card you get should be dealt with correctly, and administration takes time and a focus. Whatever the measurement of your corporation, it’s greatest to take care of a low stability so charges don’t eat into your proceeds and all the time pay your month-to-month invoice on time to guard your corporation credit standing.

The underside line

Enterprise bank cards can supply enterprise house owners extra perks and higher rewards on business-related bills. Additionally they have a tendency to supply greater welcome bonuses and will help your corporation construct its personal credit score rating. Most significantly, utilizing a enterprise bank card for authentic enterprise bills makes it simpler so that you can separate your corporation and private funds.

Though you’ll have to have a authentic enterprise to be authorised, getting a enterprise bank card might not be as troublesome because it appears. Many small enterprise concepts and aspect hustles assist you to qualify for a enterprise bank card.

With so many advantages and perks, enterprise bank cards may be simply what you must handle your prices whereas making your work life simpler and extra worthwhile. Whether or not your corporation is an off-the-cuff, part-time gig or a full-time freelance career, selecting the best enterprise bank card will provide help to keep on monitor and get forward.