Is It Ok to Use a Personal Credit Card for My Business Expenses?

Credit Cards - Complete Controller

For small business owners, managing multiple accounts and cards can be a difficult task while managing all the other operations of their business. Running a business is risky and very hectic for sole proprietors, and that’s why they’re always looking for more straightforward and less time-consuming alternatives.

Businesses with no accountants have the owner as the bookkeeper too, which is a highly complex task because you have to make sure that you make no errors. To avoid the hassle of multiple accounts and holding multiple credit cards, some business owners use their credit cards to pay off their business expenses. Check out America's Best Bookkeepers

You should have an Employer Identification Number (EIN) or a Tax ID Number to get a business credit card. The government uses these identifications for your business’ tax purposes. But to get a personal credit card, you only need your Social Security number.

To get a business credit card, you will need your business’s legal name and contact information. You will also need the industries your business operates in, your business entity or legal structure, the time in the business, and the number of employees.

In addition, you need your federal tax ID, the annual business revenue calculation and estimated monthly spend total annual income, and your credit history to provide the bank. This all is a challenge for small business owners, so they use their credit cards for business uses. A few advantages and disadvantages of using a credit card for your business expenses are: Check out America's Best Bookkeepers


  • You won’t have access to business credit. A business credit card is an excellent source of finance without paying any extra charges like interest or other fees. The business credit card also builds credit, and your credit score increases. The credit score helps you take lines of credit, and you will be eligible to take loans.
  • Your business will have less spending power. Having the same or merged accounts for your personal use and business use will make you stop spending on necessary stuff for your business as you would want to save that money for your personal use. Having a business credit card gives you a sense of more spending power, and you can spend on the right things as a business credit card typically has a much higher spending limit than a personal credit card.
  • You will face cash flow and financial management problems. When using the same card for different purposes, it can be hard to differentiate between personal and business expenses. While keeping a record of bookkeeping and other accounting transactions, you will be confused about business expenses. You also won’t be able to create a cash flow statement properly when you don’t have accurate information about the inflows and outflows of the business only. Check out America's Best Bookkeepers


  • The CARD act of 2009. The CARD act of 2009 is only provided to personal credit cardholders in the USA, and a lot of legal protection is provided to the cardholders. The banks cannot ask for high charges to issue a credit card, and the interest rates are lower too.
  • More benefits and rewards as compared to business credit cards. Credit cards are pretty safe and have better security features. You can avail of discounts and gift cards through your credit cards, and some credit cards even offer cash back on some purchases and payments.

There is absolutely nothing wrong or illegal in using a personal credit card for your business expenses. Still, you should separate your personal and business accounts and expenses to prevent any confusion. Keeping your accounts separate is easy and much more beneficial than having merged accounts.

You can have access to extra credit without having to worry about interest rates or mortgages. You can access lines of credit through credit cards if you have a satisfactory credit score. You can only have a good credit score if you have a separate bank account for your business. Your cash flows will be managed properly, and you won’t face bookkeeping problems. So you should get a business credit card for your business instead of using a personal credit card.

Check out America's Best Bookkeepers About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks™️ file, critical financial documents, and back-office tools in an efficient and secure environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity. Check out America's Best Bookkeepers