Business Credit Cards Explained

Business cards are intended for business expenses: supplies, travel, inventory, software, advertising, etc. They often come with: - Higher limits to cover larger or irregular business spending - Employee cards with separate sub-limits and optional spending controls - Rewards geared to business categories (e.g. office supply stores, gas, travel) - Expense reporting or integration with tools like QuickBooks (varies by card) - Separation of spending so business and personal expenses are on different statements

Personal cards are for individual use. Mixing personal and business spending on one personal card can complicate bookkeeping and taxes.

Reality in Canada: Many "business" cards for small businesses still require a personal guarantee and check your personal credit. True corporate cards (where the company is liable) are usually for larger businesses with an established credit profile.

Good fit if: - You have ongoing business expenses (even as a side gig or freelancer) - You want to keep business and personal spending separate for taxes and accounting - You need a higher limit or multiple employee cards - You want to earn rewards on business purchases (travel, gas, supplies)

You can wait if: - You have almost no business expenses - You’re fine using one personal card and tracking business vs. personal in a spreadsheet or app - Your personal card already has a high limit and good rewards for your spending

Rule of thumb: If you have recurring business spending and want cleaner books and better rewards on that spending, a dedicated business card is worth considering.

For small business cards in Canada, issuers usually: - Rely on your personal credit (score and history) - Ask for business details (name, type, industry, revenue)—sometimes with minimal verification for very small businesses - May require personal guarantee: you’re personally liable if the business doesn’t pay

What they look at: Your personal income and credit score matter more than business revenue for most small business products. A strong personal score (e.g. 700+) and steady income improve approval and limits.

Corporate cards (company liable, no personal guarantee) are a different product and typically require the business to have its own credit file and revenue history.

Rewards: - Cash back vs. points (e.g. travel, Aeroplan, Scene+) - Bonus categories (e.g. gas, office supplies, travel, dining) - Redemption options (statement credit, travel, gift cards)

Fees: - Annual fee (often $0–$150+ for premium business cards) - Foreign transaction fees if you buy in USD or travel - Employee card fees (some are free)

Credit limit: - Starting and typical limits for your revenue size - Ability to request increases over time

Tools: - Expense categorization or export (CSV, integration with accounting software) - Employee card controls (spending limits, alerts) - Online reporting and statements

Insurance and benefits: - Travel insurance, purchase protection, extended warranty - Relevant if you put business travel or equipment on the card

Use it only for business. Mixing personal purchases complicates taxes and can pierce the "corporate veil" if you ever have legal or liability issues.

Pay on time. Late payments hurt your personal credit and can trigger penalty rates or loss of benefits.

Track and categorize. Use the card’s tools or your own system so you can report expenses accurately at tax time.

Review employee cards. If you add employee cards, set limits and review activity regularly to prevent misuse.

Reconcile regularly. Match statements to your books so you catch errors or unauthorized charges early.