Deleted Title .

robber2

free business banking including cash paying in facility here;


https://www.starlingbank.com/blog/post-office-deposits/




Good luck


Rob

20SmthngSver

Who is your Business Current Account with? If it's Barclays, Lloyds or HSBC, I'd seriously consider switching. Go with Santander or someone who offers a flat fee, not different types of payment plans for deposits and payments like the others. Metro Bank first 50 transactions a month are free.

Business Banking fees are a joke. We still have free Business Banking luckily with Santander.

sal_III

Ergates wrote: »

Then just make the cheques payable to the business, same difference.

How are you going to explain the transactions to your accountant and more importantly HMRC? The incoming cheques will be treated as income for the company.

I'm a limited company director and know a thing or two about the matter - this is a bad idea through and through. Especially if we are talking about "saving" 0.3% of the turnover.

As others have already pointed out - it will only take one bounced cheque to wipe out the "savings" even if the scheme is above board.

Ergates

born_again wrote: »

Well it's going to arouse suspicion at banks end. As to why you have gone from cash deposits to cheques.
I can see a possible acc being locked thread in the making....

I don't see how this would look problematic to a bank. Cash being replaced by a traceable payment option is *less* suspicious. This is the opposite of what banks will be worried about.

born_again wrote: »

Also tax man may take a very close look at your books. Would be very hard to prove cash taken against cheque paid in, when family members are spending it on all sorts of things, they won't be able to account for.

Again, I don't see how this would raise a flag for the taxman. The business is replacing an easily concealable form of income (cash), with one that is much harder to conceal (cheques). Dodgy builders *never* ask to be paid in cheque, they want cash.

Also, why would the OP have to show cash was actually taken against the cheques? If it wasn't then that would effectively be the OPs friends and family just donating money to the OPs business.

JuicyJesus

Ergates wrote: »

I don't see how this would look problematic to a bank. Cash being replaced by a traceable payment option is *less* suspicious.

The source and nature of the cash is being obscured. Potentially "dirty" cash is being exchanged for "clean" cheques.

I'd consider it odd. If a business is doing a very cash-intensive trade but only ever seems to receive personal cheques for big amounts, that's a red flag.

Davy_Jones_II

JuicyJesus wrote: »

The source and nature of the cash is being obscured. Potentially "dirty" cash is being exchanged for "clean" cheques.

I'd consider it odd. If a business is doing a very cash-intensive trade but only ever seems to receive personal cheques for big amounts, that's a red flag.

Absolutely. Steps are being taken to obscure the source of funds by passing them via a third party, and swapping them into a less suspicious form.

This is exactly how money laundering works, and this scheme is so likely to flag up a problem in this respect and others that it seems crazy to run with it.

18cc

Yes that is exactly why Tesco ask if you want any cash back when you pay for your groceries - they want to launder all that dirty money in their tills into nice clean debit card transactions

brianposter

Davy_Jones_II wrote: »

Absolutely. Steps are being taken to obscure the source of funds by passing them via a third party, and swapping them into a less suspicious form.

This is exactly how money laundering works, and this scheme is so likely to flag up a problem in this respect and others that it seems crazy to run with it.

These sort of quotes illustrate why banks so often get things wrong.
In remote rural areas many businesses operate as the OP wishes to do - cashing personal cheques for known customers.

JuicyJesus

18cc wrote: »

Yes that is exactly why Tesco ask if you want any cash back when you pay for your groceries - they want to launder all that dirty money in their tills into nice clean debit card transactions

They don't give you all the cash in their tills and ask for you to pay it back to them on debit card, do they?

brianposter wrote: »

These sort of quotes illustrate why banks so often get things wrong.
In remote rural areas many businesses operate as the OP wishes to do - cashing personal cheques for known customers.

Except this isn't "cashing personal cheques for known customers" in the usual sense, is it?

born_again

Ergates wrote: »

I don't see how this would look problematic to a bank. Cash being replaced by a traceable payment option is *less* suspicious. This is the opposite of what banks will be worried about.

Clearly you do not work for a bank. Any major change would cause a employee to raise a issue. If they don't then they could be in trouble.
Remember OP said cheques would be in their name, not company.
So OP would go from paying in cash to sending payments to the business acc.

Ergates wrote: »

Again, I don't see how this would raise a flag for the taxman. The business is replacing an easily concealable form of income (cash), with one that is much harder to conceal (cheques). Dodgy builders *never* ask to be paid in cheque, they want cash.

Also, why would the OP have to show cash was actually taken against the cheques? If it wasn't then that would effectively be the OPs friends and family just donating money to the OPs business.

The issue is the source of the funds. How would they explain that cash deposited at bank, went to a transfer from a personal account?
Someone is going to think a fiddle is going on.