Business bank account for hairdressers, barbers and salons
Hair and beauty money has its own quirks: card and cash at the till, tips that may belong to your team, chair rent coming in or going out, and product bills every week. A business bank account for hairdressers should cope with all of it cheaply. This guide covers salon owners, chair renters and mobile stylists, plus the GOV.UK rules on tips, chair rental and employment status that affect how money moves.
Salon owner, chair renter or mobile?
Hair and beauty businesses work in several ways, and each needs something slightly different from a business bank account for hairdressers. Start by finding yourself below.
Salon owner
You run the premises. Money in: client payments and perhaps chair rent from self-employed stylists. Money out: rent, wages, stock, utilities and card fees. Your business bank account for hairdressers handles the most traffic.
Chair or room renter
You're self-employed inside someone else's salon. Money in: your clients' payments. Money out: chair rent, your own products and kit.
Mobile stylist or therapist
You visit clients at home. Money in: card, cash and bank transfers on the spot. Money out: fuel, products and kit. A business bank account for hairdressers with Tap to Pay suits you.
HMRC's Tax Confident guidance for hair and beauty says chair renters, mobile stylists and beauty therapists who visit clients' homes usually fall into the self-employed group. Many people also work both ways, such as employed by a salon while taking private clients, and HMRC says that person is likely to be both employed and self-employed. If that's you, keep your self-employed income in a business bank account for hairdressers and your wages in your personal account. The split makes your tax return far simpler.
Taking card payments and booking deposits
Most clients now expect to pay by card, and some will only carry a phone, so card acceptance is central to any business bank account for hairdressers. Your options broadly fall into three groups:
- Tap to Pay on your phone. No extra hardware, which suits mobile work. Tide includes Tap to Pay on every plan, and Monzo lists it among its business features.
- A card reader. A small terminal at the station or front desk. Tide offers an optional card reader.
- Payment links. Send a link by text or message to take a deposit when a client books a long colour or bridal appointment, which helps reduce no-shows.
Card payments usually arrive in your business bank account for hairdressers in batches, after the payment provider deducts its fees. Record the full amount the client paid and the fees separately, so your takings aren't understated. Our guide to card machines for small business explains how fee structures work.
Check whether card settlements count as transfers in your business bank account for hairdressers. On Tide's Free plan, payments in count towards the 5 free transfers a month, then 20p each. A busy salon receiving daily settlements could find a paid plan, or an account with free incoming payments, better value.
Cash deposit costs in a business bank account for hairdressers
Cash is still common in salons and barbers, especially for tips and walk-ins. An app-based business bank account for hairdressers has no branches, so cash usually goes in at the Post Office or a PayPoint shop, for a fee. These are each provider's published charges:
| Account | Where | Fee |
|---|---|---|
| Tide Free | Post Office | £2.50 up to £500; 0.99% over £500 |
| Tide Smart, Pro, Max | Post Office | £2.50 up to £500; 0.5% over £500 |
| Tide, all plans | PayPoint | 3% |
| Starling | Post Office | 0.7%, minimum £3 |
| Monzo Business | Post Office or PayPoint | £1 per deposit |
| Mettle | Post Office | £2.75 per deposit |
| Zempler Bank | Post Office | 0.55%, minimum £4 |
With any business bank account for hairdressers, how you pay in matters as much as where. Say a barber takes £600 in cash a week. Paying it in once as £600 on Tide's Free plan costs 0.99%, about £5.94. Paying it in as two deposits of £300 costs £2.50 each, so £5. On a flat-fee account such as Monzo, the same week costs £1. Run your own figures before choosing, and keep each deposit matched to your till records so your cash takings are clear.
Tips: the rules on whose money it is
Tips are where hairdressers most often get muddled. GOV.UK's tips at work guidance says that by law all tips must be given to workers without deductions. A statutory code of practice covers how employers distribute tips fairly and transparently, and includes the need for a written tipping policy and accurate records.
If you employ staff
- Card tips land in your business bank account for hairdressers, but they belong to your workers
- Pass them on in full, with no deductions
- Have a written tipping policy and keep records
- Tips paid through payroll have tax deducted through PAYE
If a client tips you directly
- GOV.UK says you pay Income Tax on cash tips given directly to you
- Employees report these to HMRC themselves
- GOV.UK says no National Insurance is due on cash tips paid directly to an employee
- Self-employed? Ask HMRC or an accountant how to include tips
A practical habit for salon owners: move card tips into a separate pot in your business bank account for hairdressers as they arrive. That way you never spend your team's money by accident, and your records show exactly what was passed on and when. Tips don't count towards the National Minimum Wage, GOV.UK says, so wages must meet it on their own.
Chair rental income and status
Renting out chairs or rooms is common, and HMRC's hair and beauty employment status guidance treats it as a form of self-employed work, where the stylist pays rent, may buy their own products, sets their own schedule and chooses their prices. Status depends on how you actually work day to day, not just on the contract, and HMRC's CEST tool can help when arrangements are mixed.
Chair rent should flow from one business bank account for hairdressers to another, and the steps look like this:
- 1
Agree it in writing
HMRC's example describes a written contract with each renter, setting out the rent or commission.
- 2
Invoice the rent
The salon invoices the renter, showing the rent or commission and any VAT.
- 3
Pay business to business
The renter pays from their business bank account for hairdressers into the salon's, so both sides have a clear record.
- 4
Report it
HMRC says a VAT-registered salon renting out space must report this income on a VAT return. The renter reports their own income through Self Assessment.
On VAT more widely, HMRC's guidance says you generally don't need to register until taxable turnover is more than £90,000 in a rolling 12-month period. Salon owners who are registered may need to add VAT to chair rent. Our guide on when to register for VAT goes further, and an accountant can check your arrangement.
Choosing a business bank account for hairdressers
The right business bank account for hairdressers depends on your own numbers. Put them against these four questions:
How much cash?
If cash is a big share of takings, deposit fees can outweigh any monthly plan price.
How many payments in?
Daily card settlements and chair rent can quickly use up a small transfer allowance.
Pots for tips and tax
Separate pots keep staff tips, VAT and your own tax money apart.
Card payments built in
Tap to Pay, a card reader and payment links in one app save juggling providers.
To weigh these against every account we track, compare business bank accounts. If you're just starting out on your own, our guide to registering as self-employed covers the first steps.
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Once your business bank account for hairdressers is open, tick off these habits:
- Card payments and cash takings both reconciled to your booking system
- Card tips moved to a separate pot and passed on in full
- Written tipping policy, if you employ staff
- Written chair rental agreements and invoices
- Product and kit receipts saved against each payment
- Money set aside for Self Assessment and any VAT
Hair and beauty banking FAQs
Do self-employed hairdressers need a business bank account?
Not by law if you're a sole trader. A business bank account for hairdressers still keeps client payments, chair rent and product costs separate from personal spending, which helps at tax time.
Can a salon keep card tips?
No. GOV.UK says all tips must be given to workers without deductions, and employers need a written policy on how tips are shared.
Which accounts cost least for cash deposits?
It depends on how much you pay in and how often. Flat-fee deposits suit frequent large amounts, while percentage fees suit small, occasional deposits. Use the table above with your own figures.
I rent a chair. Whose account should my clients pay?
If you're self-employed, your clients usually pay you directly. Check your agreement with the salon, and keep payments in your own business bank account for hairdressers.
Does chair rent include VAT?
HMRC says a VAT-registered salon renting out space must report that income on its VAT return. If the salon isn't registered, there's no VAT to add.
Sources
- GOV.UK: Tips at work, including the tips and tax section (checked 25 October 2026)
- GOV.UK: Check employment status if you work in hair and beauty (checked 25 October 2026)
- HMRC Tax Confident: hair and beauty (checked 25 October 2026)
- Tide help centre cash deposit fees; Starling, Monzo, Mettle and Zempler fee pages (checked 25 October 2026)