Personal credit card for business expenses

[Eternum]

Hi folks,

I'm running small business registered as S-Corp.
Can I designate a separate personal credit card to use for business expenses exclusively or there should be an "official" business credit card showing name of the company and issued by bank as business, not retail (personal) card?

Thank you.

[vangogh]

I'm not sure about what is and isn't required, but I think you'd be better off opening a business account with your bank and getting a dedicated credit card for your business. I think the card can have personal names on it, but it should be tied to the business and not the individual.

With the S-Corp you probably need to have a credit card dedicated to the business as the idea of being a corporation is to separate business from personal.

[Evan]

Your company certainly isn't going to build any type of credit history if you don't try to open a card in the name of the business.

A personal card designated EXCLUSIVELY for business use would probably be a suitable alternative.

What ISN'T suitable is a personal card OR a business card that you make business and personal purchases and figure out the details after the fact. Doing so clearly indicates you are co-mingling funds. That would be one way to pierce the corporate veil, meaning if you get sued -- you (and any/all shareholders) could be held personally responsible.

[phanio]

It is good to separate your personal and business expenses. And, a separate business credit card is a great way to do it (it will still be approved based on your personal credit history and will report to the personal credit bureaus). But, these are not the easiest cards to get - so, having a personal card (with a lower limit) may be the way to go to keep items separated. It really does not matter that much as long as you account for it correctly.

Business credit cards do offer other options including employee cards with set limits and the like. Some banks also offer purchase cards that can be tied to a line of credit or checking account (debit) where you can give employees cards but set their limits as well as set the types of businesses they can use those cards at.