In construction, money never flows in a straight line.
You’ve got invoices going out, payments coming in, retentions held back, VAT piling up, and subbies to pay – all on completely different timelines.
Some clients pay in 30 days, some in 60, some only once you chase them. Meanwhile, materials, plant, wages, and CIS deductions don’t wait.
The result?
You’re moving big money through the business every month – but it’s chaos.
That’s why most construction business owners fall into the same trap I once did: running everything through one bank account.
It feels simple at first.
All your cash is in one place, easy to check, easy to manage.
Until it’s not.
Because what’s sitting in that account isn’t all yours.
That’s what I call the Bank Balance Trap – the false sense of control you get from a single number that means nothing.
And it’s the biggest reason good construction businesses constantly feel skint, even when they’re turning over solid money.
The Chaos I Created (Without Realising It)
In my early days running my accountancy firm Bluewater, I made the same mistake.
We were growing fast, signing clients, doing great work – but every month felt like a guessing game.
Money came in, money went out, and I was constantly trying to make sense of what the balance actually meant.
Some weeks I’d think we were flush. Then payroll, VAT, and software payments would hit – and the account would drop overnight.
It wasn’t that the business was unprofitable. It was that everything was mixed together.
The more we grew, the worse it got.
That’s when I realised something simple but powerful:
You can’t make smart decisions if you can’t see what money actually belongs where.
So, I rebuilt the way money moved through the business.
And that’s how I ended up running Bluewater with five different bank accounts.
It might sound excessive – but it changed everything.
Why Five Accounts?
The goal wasn’t to make things complicated – it was to create clarity.
When everything runs through one account, your money has no identity.
By separating it into five, every pound gets a purpose.
It’s like setting up your site properly before the job starts.
You’ve got zones for materials, waste, and tools – everything has its place, so the work flows cleanly.
Your finances should be run the same way.
Here’s how I set mine up – and how I now recommend construction owners do it too.
1. Income Account – Control the Flow
Every payment from clients lands here first.
That’s it. Nothing leaves this account directly.
This is your control point – the gatekeeper.
When money comes in, you stop and review it.
What’s VAT? What’s owed to suppliers? What’s profit?
That moment of pause stops you from reacting emotionally to the balance.
2. Tax Account – Ring-Fence the Inevitable
The very first transfer I make from the income account is to the Tax Account.
Every time money comes in, I move out:
This money isn’t mine – and it never was.
Most businesses get stung at tax time because they treat tax as a surprise.
It’s not. It’s a bill you already know is coming – and you can protect yourself from it simply by separating it.
Once I started doing this, I never worried about a VAT bill again.
3. Operating Account – Run the Business Smoothly
This is the account that funds day-to-day operations: wages, suppliers, hire, fuel, subscriptions, insurance, rent – everything needed to keep the business moving.
But here’s where most construction owners go wrong: they don’t actually know what’s coming out of this account each month.
So before I did anything else, I sat down and listed every single direct debit, standing order, and fixed cost tied to the business. For example in your business you should account for:
When I added it all up, I realised how much of the monthly spend was automatic.
That total – your base load – is the minimum your business burns through every month, even if no new money comes in.
Once you know that number, you stop guessing.
Now, when I look at the operating account, I know exactly how much is spoken for – and how much is genuinely free to spend.
That one bit of clarity completely changed how I make financial decisions.
4. Shareholder Account – Pay Yourself Properly
This is where your personal pay and dividends come from.
Every week or month, a fixed percentage of income moves here.
This isn’t a “bonus” – it’s your proper reward for running the business.
The beauty of this setup is that you stop “taking what’s left” at the end of the month and start paying yourself intentionally.
It’s predictable. It’s guilt-free.
And it forces you to treat your pay as a planned cost – not a panic decision.
Because the truth is: your business should fund your life, not the other way around.
5. Reserve Account – Build Breathing Room
This is your safety net.
Whenever we have a strong month, I move a small percentage here – even if it’s only 3–5%.
It’s what keeps you calm when a client pays late or a project slows down.
Think of it like a cash buffer – the difference between panic and patience.
When things tighten up, you can cover costs without borrowing, stressing, or dipping into your tax money.
Over time, this account becomes your business confidence.
What Changed After I Made the Switch
Once I split the money into five accounts, everything clicked into place.
The same amount of cash was moving through the business – but for the first time, I could see what it all meant.
I stopped reacting to the bank balance.
I started leading with clarity.
That’s the power of structure.
It doesn’t just make the business neater – it makes you sharper.
Because once you know where every pound belongs, you stop managing stress and start managing strategy.
How You Can Put It in Place
You don’t need an accountant to start this.
You can do it this week.
1. Open additional business accounts.
Most business banks like Starling, Tide, or Monzo make this simple – you can open multiple accounts or “pots” in a few minutes.
Use these to separate your money clearly: create saving-style accounts for things like tax and reserves, and full current accounts for your Income and Operating accounts – the ones you’ll actually make payments from.
Savings accounts are perfect for parking cash you don’t need to touch, while current accounts handle your day-to-day payments. Keep them separate, but easy to move between.
2. Every time money lands:
3. Know your base load.
List every recurring cost so you know what’s already committed.
4. Do this weekly.
I move money every Friday – same time, same process.
Within a few weeks, you’ll feel the difference.
You’ll know exactly what’s yours, what’s owed, and what’s safe to spend.
That’s the kind of clarity that lets you focus on growth instead of firefighting.
Could Your Business Survive Three Months Without Touching Your Tax Money?
If the answer’s no, your system isn’t giving you control – it’s feeding the chaos.
That’s not a cashflow issue; it’s a structure issue.
Because when all your money lives in one pot, you’re guessing – not managing.
You can’t plan properly.
You can’t relax properly.
And you definitely can’t grow properly.
But once your money’s separated, everything changes.
You can open your banking app and see what’s real – what’s tax, what’s wages, what’s safe to spend.
That’s real financial clarity.
And it doesn’t come from spreadsheets – it comes from structure.
When you get that structure right, you stop firefighting and start leading with confidence.
Remember:
You can’t build control on confusion.
Get your structure right – and the clarity will follow.
We will never spam or sell your info. Ever.