If you’re a small business owner looking to simplify expenses, opening a business credit card can provide numerous benefits. Many small business credit cards offer free employee cards, rewards and special financing that make them essential for entrepreneurs.

There are a variety of small business cards available — some offer cardholders a chance to earn cash back, points or miles on all your spending — which makes it hard to choose the best card. There’s no one-size-fits-all card since every business is unique. But there are some steps you can take to ensure you choose the best credit cards for your needs.

Below, CNBC Select reviews how business credit cards work and the key features you should consider before choosing one.

How to choose a business credit card

  1. Understand how business credit cards work
  2. Review your business’s expenditures
  3. Consider added benefits

1. Understand how business credit cards work

Before you apply for a business credit card, familiarize yourself with they work.

  • Personal liability: In most cases, you (as the business owner) are personally responsible for any charges made on your business card account, including employee purchases.
  • Less protections than personal credit cards: Business cards aren’t protected under the laws of the CARD Act, making it even more important to always pay on time and in full. You may see a sudden increase in your APR without notice or a shortened grace period if you miss a payment.
  • Charge card vs. credit card: Just like personal credit cards, there are two types of business cards — charge cards and credit cards. With a charge card, there is no preset spending limit (though that doesn’t mean unlimited spending) and as a result, you’re required to pay the bill in full every month. American Express is known for its business charge cards, such as The Business Platinum® Card from American Express. Meanwhile, a business credit card has a preset spending limit, but allows you to carry a balance month-to-month, with interest. These cards also offer intro 0% APR periods, which aren’t an option with business charge cards.
  • Employee cards: A great benefit of small business credit cards is the ability to open employee cards and track their spending. Many business cards offer free employee cards that help streamline expenses, without the need to reimburse employee spending on personal cards.

2. Review your business’s expenditures

Once you understand how business credit cards work, evaluate your spending habits. You can review your books from the past year to find identify the categories where you spend the most money, such as travel, advertising or dining. From there, you can begin searching for a business card that will provide the most benefit for those purchases.

Here are some questions you can ask yourself:

  • Does my business require me or my employees to travel frequently? If yes, it’s a good idea to choose a card that doesn’t charge foreign transaction fees and gives you the opportunity to earn travel rewards. The Business Platinum® Card from American Express offers 5X Membership Rewards® points on flights and prepaid hotels on amextravel.com and 1X points on all other purchases.
  • Do I entertain clients at restaurants? Consider a card that rewards dining purchases, such as the American Express® Business Gold Card, which offers 4X Membership Rewards® points on the two select categories where your business spent the most each month (such as spending at U.S. restaurants).
  • Does my business require driving? Some cards offer higher rewards for gas purchases that may help offset the cost of fueling vehicles when your redeem cash back as a statement credit. The Bank of America® Business Advantage Cash Rewards Mastercard® credit card offers 3% cash back on your choice of one of six categories (gas stations is the default), 2% cash back on dining (for the first $50,000 in combined choice category/dining purchases each calendar year, then 1%) and 1% cash back on all other purchases.
  • Do I spend on typical business purchases, such as shipping and phone services? If you find yourself spending in common business categories, consider cards that reward those purchases. The Ink Business Preferred℠ Credit Card offers 3X points per $1 on the first $150,000 spent in combined purchases in select categories each account anniversary year (travel; shipping purchases; internet, cable and phone services; and advertising purchases with social media sites and search engines) and 1X point per $1 on all other purchases.
  • Is it impossible to categorize my business spending? If your business is new or if you spend across a variety of categories, consider a simple flat-rate cashback card. These cards are also good for a business that has changing needs. The Capital One® Spark® Cash for Business offers 2% cash back on every purchase in every category.

3. Consider added benefits

Beyond streamlining expenses and earning rewards, business credit cards can provide special financing offers, account management tools, extended warranties and more.

Here are some additional benefits to consider when comparing cards:

  • Special financing offers: Many business cards offer intro 0% APR periods on new purchases that can be as long as 15 months. During the intro period, you can carry a balance without incurring interest charges. This can be a great asset for costly purchases, such as laptops, printers or office furniture.
  • Purchase protection and insurance. Business cards may offer a suite of purchase protections, such as extended warranty coverage, and insurances, such as cell phone protection, travel insurance and auto rental damage collision insurance.
  • Luxury perks: Premium business cards may come with hefty annual fees over $400, but they often provide perks that offset the fee. Look out for annual airline fee credits, lounge access and elite status at airlines or hotels.
  • Account management tools. Business cards often offer various perks that make it easy to track spending. Cards may come with quarterly and year-end summaries, itemized receipts and the ability to export transactions to Excel or other accounting software.

Information about the Capital One® Spark® Cash for Business has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the CNBC Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.

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