Why Do I Need a Bank Connection?

Technically, you probably don’t need a bank connection. If you are a sole proprietor, a bank connection is not required for proper bookkeeping. In fact, you don’t even need a business bank account.

Why is that?

A 'one person business' is fiscally transparent, meaning that for tax purposes, you are considered a private individual. This means that what happens in your bank account does not directly impact your business administration (this does not apply to limited liability companies (BV in Dutch). If you want to learn more about this, read this blog post (in Dutch)).

So, anyone who says that your bank account must always be the starting point of your administration is not entirely correct from a technical standpoint. However, using your bank account as a starting point is very convenient.

Most of your income and expenses will go through your bank account. If you want to make sure you don’t forget to add any income or expenses to your bookkeeping, using a bank connection as a starting point is a smart choice.

Want to learn how to link transactions to your bookkeeping? Read the article Matching Transactions on Bank Page.