Transferring significant sums of money between family

whatstheplan

Our mother intends to transfer a significant amount of money (significant to us) from her ISA to myself and my sibling.  In a sense, giving us part of our inheritance now.  The sum to each would likely be in the region of £30-40k.

Is requesting to do this likely to set alarm bells ringing from the banks perspective?  Is the bank within their right to ask why she is transferring such large sums of money (e.g. to ensure no coercion, money laundering etc) and if yes, exactly how much information does my mother have to provide?

This will be a face to face transaction as she doesn't bank online.  She usually likes me to go into the bank with her (she's elderly) however I've already said I won't be going in this time as my presence might be construed in the wrong way.

We don't have an issue providing whatever information we need to, however equally we don't want to divulge information that the bank has no legal requirement to know.

Any advice welcome. 

General_Grant

whatstheplan said:

Our mother intends to transfer a significant amount of money (significant to us) from her ISA to myself and my sibling.  In a sense, giving us part of our inheritance now.  The sum to each would likely be in the region of £30-40k.

Is requesting to do this likely to set alarm bells ringing from the banks perspective?  Is the bank within their right to ask why she is transferring such large sums of money (e.g. to ensure no coercion, money laundering etc) and if yes, exactly how much information does my mother have to provide?

This will be a face to face transaction as she doesn't bank online.  She usually likes me to go into the bank with her (she's elderly) however I've already said I won't be going in this time as my presence might be construed in the wrong way.

We don't have an issue providing whatever information we need to, however equally we don't want to divulge information that the bank has no legal requirement to know.

Any advice welcome. 

Is your mother in good health?  How old is she?  How much capital will be left in her accounts if she moves £60-80k out?

I believe the bank can legally ask whatever it wants in order to be satisfied that the transfers are legitimate.

Daliah

Your mother can transfer as much as she likes to whoever she likes to. Just two things she should be aware of in some detail:

1. deprivation of assets
2. potential Inheritance Tax implications

Information about both subjects is available online or from the CAB / Age Concern / Government websites.

EssexExile

I have no trouble moving amounts like that around, others appear to have problems. I suspect what matters is how much of a deviation from normal it is. if the bank ask questions all one can do is answer them honestly.

ZeroSum

Instead of a bank transfer, could she not just write a cheque out. That way you probably wouldn't get asked any questions 

Daliah

ZeroSum said:

Instead of a bank transfer, could she not just write a cheque out. That way you probably wouldn't get asked any questions 

As she doesn't do online banking, she might still have to answer questions when she's requesting the money to be moved from her ISA to her current account, as she can't write a cheque against the ISA account. In any case, she should not need to worry about questions the bank asks. After all, it is her money, and she's free to do with it what she likes. The bank is, however, expected to take all reasonable precautions against her being scammed, especially in the light of all the crimes involving older people.

She will still need to understand, for her own sake and that of her eventual heirs, the two items I mentioned above.

whatstheplan

Thanks all, yes she's in good health, nearing 80.  If she elects to do this, she will still have ~ £30k in her ISA.

Alter_ego

Is she/you trying to avoid inheritance tax/care home fees etc? whatstheplan

whatstheplan

Alter_ego said:

Is she/you trying to avoid inheritance tax/care home fees etc? whatstheplan

I wouldn't say so.  She feels she has £x in her ISA, sitting doing nothing, and is pondering giving us £x now so we can make use of it.

SevenOfNine

Have a read here & be absolutely sure she won't need any of the 'giveway', it's difficult to be certain given her elderly status though, because anything could happen (dementia, falls breaking limbs etc). https://www.ageuk.org.uk/information-advice/care/paying-for-care/paying-for-a-care-home/deprivation-of-assets/

If she dies (sorry) within 7 years, it will have to be declared on the probate tax forms.

If she, you & sibling are OK with everything then why not, I can see her point.  If it's specifically to avoid IHT or care fees I'd think twice.

Move it from the ISA & she can write cheques - that's what my mum did (though not for such mega sums).

Daliah

whatstheplan said:

Alter_ego said:

Is she/you trying to avoid inheritance tax/care home fees etc? whatstheplan

I wouldn't say so.  She feels she has £x in her ISA, sitting doing nothing, and is pondering giving us £x now so we can make use of it.

You might not say so. It is however not your decision but a matter of law, and of your mother's longevity and care needs, whether inheritance tax and deprivation of assets could become relevant.