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Before diving into how you report your business revenue on a credit card application, let's clarify what revenue really means. Annual business revenue is the total amount of income your business generates in a year. This is different from profit, which is what's left after taking out operating costs, taxes, and other expenses. Revenue is the grand total of all the money your business brings in, whether from selling products, renting out property, or any other income source.
When you apply for a business credit card, your income is one of the key factors that creditors consider to assess your creditworthiness. To give an accurate picture of your financial situation, you need to include all your revenue streams from the past 12 months. This includes not only what your business sells but also any income that can be verified.
Key takeaways:
- Annual business revenue is your total income before expenses and taxes are deducted.
- Gross annual revenue from the previous year is typically required for your credit card application.
- Small business owners may need to report both business revenue and personal income.
- Your figures should be from the previous year, not sales projections or future earnings.
What type of revenue should you report?
Now that you understand the importance of accurate revenue reporting, let's see what you should include:
- Gross annual revenue from the previous year.
- Any other income that can be verified through documentation like sales records, contracts, or invoices.
- Make sure not to report sales projections unless it's explicitly allowed by the issuer.
What should be left out?
Equally important is what you should avoid including:
- Revenue or income that can't be backed up with pay slips, receipts, or other documents.
- Personal income unrelated to the business in question. Keep them separate.
How to verify your revenue
You might be wondering how to prove your revenue. The key is to consult documentation like tax returns, bank statements, or profit and loss statements.
Why is business revenue required?
There's a reason credit card issuers want to know about your annual business revenue. It helps them:
- Assess if you're likely to manage your finances responsibly and make payments on time.
- Determine your credit limit based on your financial situation.
Tips for reporting revenue effectively
Here are some handy tips to ensure your revenue reporting is spot-on:
- Be honest and accurate. Exaggerating or conflating your business income can backfire.
- Keep your report clear and concise. No need for unnecessary details.
- Provide supporting documentation if you have it. It helps validate your figures.
To apply for a Capital on Tap Business Credit Card, your business must have a gross revenue of at least £24,000 per annum.
What if my business doesn’t have revenue yet?
If your business is brand new and doesn't have revenue to report, don't worry. You can be upfront about it on your application. Many lenders will also look at your personal credit report if your business credit history is limited.
The bottom line
Accurately reporting your annual business revenue on your credit card application is a crucial step in the process. It helps creditors evaluate your creditworthiness and sets the stage for responsible financial management. Be honest, provide evidence where possible, and ensure you're only reporting verified income.
Ready to reap the rewards of a business credit card? Apply for a Capital on Tap Business Credit Card today to enjoy unlimited 1% cashback, expense management software, and limits up to £250,000.
This does not constitute financial advice. If you wish to understand how to report your business’ revenue on a business credit card application, contact your financial advisor or accountant.
