The answer splits on what you are, not on how big you are
This is one of the few business questions where the structure genuinely decides it, and the two answers are different in kind rather than in degree.
Sole trader: the law says no, your bank may say otherwise
Sole traders and ordinary partnerships are not legally required to hold a business bank account. There is no legal separation between you and the business, so the income is simply your income.
The catch is that this is a question about your bank rather than about the law. Many personal account terms do not permit business transactions, and those terms are enforceable whether or not anybody read them. A bank that notices regular trading activity can close the account, which is an unpleasant surprise at a moment when you have customers paying into it.
Limited company: the money was never yours
A limited company is legally separate from the people who own it, and there has to be a clear division between the company's finances and those of the owners and directors.
That is a different statement from "you should keep things tidy". Running company income through a personal account is not disorganisation, it is mixing the funds of two separate legal persons, and the accounts have to untangle it afterwards regardless.
Which is where the director's loan account comes from
Money you take out of the company that is not salary and not a dividend has to go somewhere, and where it goes is a director's loan account.
You must keep a record of money you borrow from or pay into the company, and the balance appears on the balance sheet in the annual accounts. If the company owes you, that is simple enough. If you owe the company, tax consequences attach to the balance and to how long it stays outstanding, which is why an accountant will care about this far more than a director expects them to.
None of that is avoided by not naming it. The account exists as soon as the money moves.
Two personal accounts is not the answer people think it is
Using a second personal account is a common halfway house. It genuinely helps the bookkeeping and it does nothing about either problem above.
Two personal accounts are still personal accounts, so if the terms prohibit business use then business use breaches them either way. And for a company it misses the point entirely, because the issue was never tidiness, it was whose money it legally is.
The reason to do it anyway
Even where nothing requires it, a separate account turns your bank statement into most of your records, and that is the difference between a tax return that takes an afternoon and one that takes a weekend of scrolling past supermarket shops trying to remember what a payment was.
It also makes the money you are holding for somebody else visible. VAT you have collected is not yours and the tax you owe is money not yet set aside, and both are far easier to keep separate when the trading account is not also paying the mortgage.
What this decides next
If the underlying question is which structure to be in the first place, sole trader against limited runs that comparison including the costs people leave out, and when corporation tax is due covers the deadline that arrives before the accounts are finished, which is a cashflow problem a separate account makes considerably easier to see coming.
On the money being held rather than earned, what VAT actually is explains why a registered business is a collector rather than a payer, and record retention covers how long the statements and everything else have to be kept.
Common questions
Do sole traders have to have a business bank account?
Not as a matter of law. Sole traders and ordinary partnerships are not legally required to have one, because there is no legal separation between you and the business: the money is simply your money. What catches people is that this is a question about your bank rather than about the law, since many personal account terms do not permit business transactions at all, and a bank that notices can close the account.
Does a limited company need one?
Effectively yes, and for a more fundamental reason than a rule requiring it. A limited company is legally separate from the people who own it, and there has to be a clear division between the company’s finances and the directors’ own. Company money is not your money, so running it through a personal account is not an untidy habit, it is mixing two different legal persons’ funds and it creates work and risk that a separate account simply avoids.
What happens if I take company money personally?
It goes to a director’s loan account, whether or not anybody uses the phrase. You must keep a record of money you borrow from or pay into the company, and that balance appears on the balance sheet in the annual accounts. If the company owes you, that is straightforward. If you owe the company, there are tax consequences attached to the balance and to how long it stays outstanding, which is why accountants care about it far more than directors expect.
Can I just use a second personal account?
People do, and it solves the bookkeeping problem without solving the terms problem. Two personal accounts are still personal accounts, so if the terms prohibit business use then using one for business breaches them just as much as mixing everything in one. It also does nothing at all for a limited company, where the issue is not tidiness but whose money it legally is.
What are the practical reasons beyond the rules?
Bookkeeping, mainly, and it is worth more than it sounds. A separate account turns your bank statement into most of your records, which makes a tax return an afternoon rather than a weekend of scrolling through personal spending. It also makes it far easier to see what the business is actually doing, and it removes the awkward conversation where somebody has to work out whether a payment was materials or a supermarket shop.
Does it help with the VAT and tax money?
It makes the discipline possible rather than theoretical. VAT you collect is not your money and tax you owe is money you have not set aside yet, and both are far easier to keep separate when the trading account is not also paying your mortgage. Plenty of businesses move both out into a second account as they arrive, which is a habit rather than a rule and the one that most reliably prevents a January that goes wrong.