Is it possible to get a business credit card without a business?
Is it possible to get a business credit card without a business?
Business credit cards offer unique benefits that are not always available with personal credit cards, such as higher sign-up bonuses and specialized rewards categories. But can you take advantage of them if you are self-employed or freelance, or if you have an occasional side job?
In most cases, the answer is yes. All you have to do to get a business credit card is earn money independently. Here’s what you need to know about applying for a business credit card if you don’t have a traditional business.
Requirements for a business credit card
You may be more of an entrepreneur than you think. Any income-generating activity can be considered a legitimate business for a business credit card. Here are some examples of common nontraditional businesses:
.Walking dogs in your neighborhood
.Buying and selling on eBay
.Working as a virtual assistant
.Driving for ridesharing apps, such as Uber or Lyft
.Delivering food with app-based companies like DoorDash or Grubhub.
.Tutoring children, in person or online
.Buying and selling antiques
.Working as a freelance consultant
.Selling homemade items at flea markets or online (such as on Etsy or Facebook Marketplace).
.Working as an artist
.Freelance writing and editing
.Social media management
In short, if you make money from your work, you can apply for a business credit card. To apply for a business credit card, you do not need to have an LLC or a registered corporation. If you find a section in your credit card application asking for your “tax ID number,” you can register as a sole proprietorship. As a general rule, you can enter your personal social security number instead of the tax ID number.
Business credit card requirements
If you have a registered business, including an LLC, you must apply using your business information, including your federal tax identification number, also known as your employer identification number (EIN). If you run your business without a formal structure, you can apply as a sole proprietorship using your social security number.
In any case, be prepared to provide the following information
.the annual income of your company
.the age of the company
.the industry in which the company operates
.your role in the company
.Number of employees (if any).
.The address of the company, even if it is your home address.
.The telephone number of the company, even if it is your home number.
Depending on the paper, it may be necessary to send documents proving the existence of a company. These may include information from the Internal Revenue Service showing your tax identification number or information about your income. In most cases, however, you will receive notification of approval within seconds of submitting the online application.
Why get a business credit card instead of a personal credit card?
There are many reasons to get a business credit card for your business, including
Rewards for business expenses
You probably have business expenses for which you could get rewards or cash back. For example, if you are a rideshare or delivery driver, you may have to pay for gasoline, vehicle maintenance, and repairs. If you sell crafts or art, you will probably have to buy supplies.
Whatever your expenses, you can earn cash, points or miles if the card has a rewards program. If the account offers a sign-up bonus for new cardholders, you can earn a significant bonus if you meet a minimum spending requirement in the first few months after opening the account.
Separate personal spending from business spending
Separating personal and business credit cards can help you get organized. Not only will you have better control over expenses, but charging all expenses to your business credit card will help you pay your taxes.
Establish your business credit rating
While your personal credit score is taken into account when you apply for a business credit card, you can build a business credit history when your credit issuer provides data to the three major business credit bureaus-Dun & Bradstreet, Equifax, and Experian.
Keeping accounts current will improve your corporate credit score over time, making you eligible for other corporate credit products.
Benefits for businesses
Many of the best business credit cards offer special benefits, such as mobile phone insurance and cash credits for business-related products and services. It is advisable to choose the card best suited to your business.
What to look for in a business credit card
Although business credit cards offer many advantages, they can also have some disadvantages. Often the business credit cards that offer the most advantages have a high annual fee. For example, the Business Platinum Card® from American Express has a high annual fee of $695. But if you are not sure how often you will shop with the card, or if you will not actually use the benefits, consider a business credit card with no annual fee.
Of course, each card must be managed properly, which requires time and attention. You must try to keep a low balance so that fees do not eat into your income, and always pay your monthly bills on time and in full to protect your credit rating.
The best credit cards for nontraditional businesses
Here is our selection of the best business credit cards for road trips, creative jobs, e-commerce and air travel.
Marriott Bonvoy Business American Express Card: the best for travel and auto-related businesses.
For an annual fee of $125, the Marriott Bonvoy Business® American Express® Card offers quadruple points when you fill up at U.S. gas stations. If you drive people or products all day, the rewards add up quickly. But that’s not all. Cardholders earn 6X points for eligible purchases at participating Marriott Bonvoy hotels, and 4X points at worldwide restaurants, U.S. transportation providers, and U.S. wireless services. Everything else will earn you 2X points.
When you travel, you can take advantage of the “Free Night Award” that you earn each year after your card renewal month (worth up to 35,000 points) and an additional free night after spending $60,000 in a calendar year.
Ink Business Cash credit card: best for creative work
If your business involves making and selling items, you’ll want a card that allows you to purchase a wide range of items and earn a variety of rewards. Chase’s Ink Business Cash® credit card offers 5 percent cash back on the first $25,000 spent at office supply stores (as well as Internet, cable and telephone services) each account anniversary year. You can purchase everything you need for your business, including paper, design services, photography and printing, and items for your home office to create the perfect environment that inspires you.
You will also get 2% cash back on the first $25,000 of combined purchases at gas stations and restaurants each account anniversary year, and 1% cash back on all other purchases. Best of all, there is no annual fee.
Amazon Business Prime American Express Credit Card: best for businesses that shop online.
If your business spends a lot on items from the world’s largest online retailer, the Amazon Business Prime American Express card* can be very useful. With no annual fee, you’ll get a 5% rebate or a 90-day guarantee on purchases at Amazon Business, AWS, Amazon.com and Whole Foods. You will get a 2% discount at U.S. restaurants, gas stations and wireless services and a 1% discount on all other purchases.
The Business Platinum Card from American Express:
the best solution for meeting distant clients
Your business may involve a lot of air travel. For business travelers, the Business Platinum Card from American Express is a popular choice. It is a fee-based card, so you will have to pay the balance in full each month.
You will have to pay an annual fee of $695 to get this card, but in return the rewards and benefits are substantial. Earn 5X Membership Rewards points on prepaid flight and hotel bookings on AmexTravel.com, 2X points on prepaid car rentals booked on AmexTravel.com, and 1.5X points on purchases of at least $5,000 (up to $2,000,000 per calendar year) and on purchases in selected categories. All other purchases are equivalent to 1X points.
You can increase the value of points by transferring them to American Express partner airlines and hotels. Bankrate values Amex Membership Rewards points at 2.1 cents each for travel with high-value transfer partners, meaning 100,000 points can be worth up to $2,100.
The bottom line.
With their many benefits, business credit cards can help you manage costs and make your business life easier and more profitable. Whatever your business, whether it’s a casual part-time job or a full-time professional, the right business credit card will help you stay on track and keep you going.