A bond when you are self-employed

What replaces the payslip

• Bank statements, usually twelve months — personal and business, in the bank's own PDF. This is the primary evidence, not a supporting document.
• Annual financial statements, signed, and management accounts where the year end is far behind you.
• Proof you are who you say you are in the business — company registration, or an accountant's letter confirming your share and your drawings.

The small-salary problem

Most owner-managed businesses pay the owner a modest salary and take the rest as drawings or dividends, for perfectly good tax reasons. A bank reading only the salary sees someone earning far less than they do. The whole job is showing the real, sustainable income — salary plus drawings plus whatever the business reliably pays out — and showing it consistently enough that a credit officer will count it.

This is also where most self-employed applications quietly die. Not declined on merit: declined because what was handed over did not add up to an income anybody could rely on.

What a credit officer is looking for

• Consistency. Twelve months that look like each other beat three excellent months.
• A separation between you and the business. Where the business account is also the grocery account, the numbers cannot be read and the application stalls.
• An explanation for anything odd. A quiet quarter, a large once-off deposit, a loan from a family member. Explained in a line it is context; unexplained it is a question that comes back three weeks later.

Why it is worth going to more than one bank

Banks differ far more on self-employed income than on a salary. How many years they want, whether they count drawings, how they treat a loan account, how much of a dip they will look past — all of it is each bank's own policy. The same pack can be a decline at one and straightforward at another.