Change name on inheritance cheque ?

morrissey318

A friend of mine was left a sum of money in a will . Problem is , this friend is in mortgage arrears . The sum received won't be nearly enough to cover his arrears and he's ultimately facing a repossession . He doesn't want to throw good money after bad and is just biding his time till he has to give up the house . He wants to ask the solicitor to write the inheritance cheque in his daughter's name , as he'd rather the money went to her than the bank . My feeling is that if he's named in the will that the only person who's name can go on the cheque is his. Am I correct ?

Santa Cruz

Is there any reason why he cannot open a bank account elsewhere for the purpose of processing the cheque ?

Johnboy1951

Could he not sign the back of the cheque and have his daughter lodge it in her account?

Zambia

Well this all sound very legit?

mikom

morrissey318 wrote: »

A friend of mine was left a sum of money in a will . Problem is , this friend is in mortgage arrears . The sum received won't be nearly enough to cover his arrears and he's ultimately facing a repossession . He doesn't want to throw good money after bad and is just biding his time till he has to give up the house . He wants to ask the solicitor to write the inheritance cheque in his daughter's name , as he'd rather the money went to her than the bank . My feeling is that if he's named in the will that the only person who's name can go on the cheque is his. Am I correct ?

Get him to make the cheque payable to John Q Taxpayer.

whomitconcerns

So you want to do exactly as the bankers are said to have done and transfer assets to another family member to avoid paying bills and leave it such on everyone else.... Yeh good luck with that.... Tell him to pay up clear some of his mortgage and get a new better payment plan

morrissey318

whomitconcerns wrote: »

So you want to do exactly as the bankers are said to have done and transfer assets to another family member to avoid paying bills and leave it such on everyone else.... Yeh good luck with that.... Tell him to pay up clear some of his mortgage and get a new better payment plan

Please don't think that I approve of his behaviour . I'm appalled by it . He chose to stretch himself way beyond his financial limits (against my advice) in the 'good times' and I find it difficult to feel sorry for his plight now . I just asked the question as I feel it's not legit and do not want him to end up in serious trouble .

Santa Cruz : He says that there's transparency amongst banks so it could be located if he lodged it in another one ?
Johnboy 1951 , I'm not sure , but that seems like a possibility .

daveohdave

He didn't listen to your advice before, what makes you think he's going to listen now? Hey sounds like a muppet, let him dig his own grave.

whomitconcerns

if he did get the check changed he would still be giveing it to her as it is his legal inheritance, so would be paying inheritance tax and then assuming it wasnt picked up on then gift tax. So legally he could be getting himself in a lot of trouble as he would be evading either or both of them.

Johnboy1951

whomitconcerns wrote: »

if he did get the check changed he would still be giveing it to her as it is his legal inheritance, so would be paying inheritance tax and then assuming it wasnt picked up on then gift tax. So legally he could be getting himself in a lot of trouble as he would be evading either or both of them.

I have read nothing from the OP to indicate this being done to evade or even avoid tax liability.

I see nothing wrong at all in receiving an inheritance in one hand and giving the same amount to another from the other hand.

Doing this does not in any way imply tax evasion ....... be rather difficult anyway as the monies would be easily traceable.

It would though stop the bank from grabbing it for their own ..... and I have less sympathy for the poor banks than I do for the greedy who got caught by the financial crisis.
My sympathy lies entirely with those who were caught badly by the crisis through no fault of their own.

whomitconcerns

Johnboy1951 wrote: »

I have read nothing from the OP to indicate this being done to evade or even avoid tax liability.

I see nothing wrong at all in receiving an inheritance in one hand and giving the same amount to another from the other hand.

Doing this does not in any way imply tax evasion ....... be rather difficult anyway as the monies would be easily traceable.

It would though stop the bank from grabbing it for their own ..... and I have less sympathy for the poor banks than I do for the greedy who got caught by the financial crisis.
My sympathy lies entirely with those who were caught badly by the crisis through no fault of their own.

Well its his inheritance so he is liable for the tax, if he somehow transfers the inheritance at source then he doesnt have to pay the tax. The transferee would be liable for the tax then..thats if it were possible.

If he receives the inheritance and just passes it to someone else then they would be liable for tax on the gift, as that is what it would be..

BUT it all depends on how much we are talking about to be honest, so you could be right either.

The banks debts now belong to you and me so its you and me he would be keeping the money from not the bank.

And sorry but no one got caught badly through no fault of their own. I know where you are coming from and I do understand/sympathise with what your saying but to say people had no liability for their own decisions is wrong. We are all adults, maybe some were more gullible/naive than others, but they still have to bear some liability.

Losty Dublin

morrissey318 wrote: »

A friend of mine was left a sum of money in a will . Problem is , this friend is in mortgage arrears . The sum received won't be nearly enough to cover his arrears and he's ultimately facing a repossession . He doesn't want to throw good money after bad and is just biding his time till he has to give up the house . He wants to ask the solicitor to write the inheritance cheque in his daughter's name , as he'd rather the money went to her than the bank . My feeling is that if he's named in the will that the only person who's name can go on the cheque is his. Am I correct ?

Unless it's a token few hundred then he is better off showing some kop on and putting the money to his mortgage arrears, even if it is a small amount. Lose his house and the debt will still be there; this windfall could well be the difference between keeping his home and losing it, especially if a repossession hearing gets wind of it.

NUTLEY BOY

To answer the actual original question I think that the answer is "no".

If a specific money bequest was made it is the responsibility of the executor to see that the wishes of the testator are executed as per the will.

It is a while since I did a personal application for a grant of probate as a personal applicant executor. So, I assume that the executor will submit an Inland Revenue affidavit as part of the probate process. Part of the affidavit includes identification of the beneficiaries. After the grant of probate issues a copy of that affidavit goes to Revenue. Therefore, they will know who received what anyhow !!

If the inheritance passes a certain percentage (80 % ???) of the relevant threshold value for capital tax purposes the beneficiaries will hear from Revenue with a request to make a return to assess their liability, if any, to capital tax. OP's friend may or may not have a tax liability contrary to the assumptions of some people.

The core point is that that OP's friend cannot make the inheritance "disappear" by having the cheque made out to someone else! OP's friend has received the benefit of the inheritance even though he passes it on in turn. The act of passing on the benefit does not alter the terms of the bequest or create an artificial situation as if the inheritance was actually received by somebody else.

The daughter of the beneficiary who receives, in turn, the benefit from her father of his inheritance has nothing to do with the original will or any of it's associated tax implications. Passing the benefit of the inheritance to his daughter is a new and separate transaction altogether.

As far as mortgage arrears are concerned my conscience would be clear in keeping the money out of the bank's hands on the assumption that there is no judgement, garnishee or other form of court order in place against OP's friend.

The practical thing to do is as mikom suggests and simply endorse the cheque over to the benificiary's daughter.

Claw Hammer

Johnboy1951 wrote: »

I have read nothing from the OP to indicate this being done to evade or even avoid tax liability.

I see nothing wrong at all in receiving an inheritance in one hand and giving the same amount to another from the other hand.

Doing this does not in any way imply tax evasion ....... be rather difficult anyway as the monies would be easily traceable.

It would though stop the bank from grabbing it for their own ..... and I have less sympathy for the poor banks than I do for the greedy who got caught by the financial crisis.
.

It would not stop the bank claiming it. The bank could seek to have the transfer set aside on the basis that it was a transfer for the purpose of defeating creditors.
If bhe simply passe it to his daughter there would be tax inplications. It may be easier to renounce the gift and have it put back into the residue of the estate. It all depends on how the resideue is to be distributed.