Mother gives son cheque made out to him and asks him to cash it for her?

C

Clara16

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My husband’s mother handed him a cheque made out to him for €10,245. She said it is a life policy she was paying into for him and she has cashed it in. The cheque is made out to my husband, she wants him to lodge it into his account and take out the cash and give it back to her.

By doing this would it have any tax/gift implications on my Husband. He is happy to do this for her, I am still curious as to why the cheque is made out to him and should he look for more info from her.

I have no interest in taking her money but find the situation a little odd and want to make sure she is being honest without interfering. As from the point of revenue I want to ensure all will be in order.
 
Think you need to better understand what is going on here. Who owns the life policy? Did the son ever sign anything? Was he aware of it? Where did the money that was paid into it come from, was it out of after tax earnings? Who is the cheque made out from - is it a life insurance company to start with?

Why not have your husband contact them, if the policy is in his name I would have though that he is fully entitled to have them discuss the policy with him over the phone. Presume he could contact them without needing mothers permission. Ask them for a copy of relevant paperwork, policy details, copy of documentation that accompanied the cheque, they simply didn't send a cheque on its own in all likelihood, etc.

Once you have established the facts then you can move to the next stage!
 
his Mum told him it is a policy she took out on him to cover any funeral expenses etc in the event of his death, there was a lump sum also at the end. she has had it since he was a child, he wasn't aware and definitely didn't sign anything. the cheque is at home I will have a better look at it tonight. she has already signed the back of it for him ! thanks for the reply
 
"He is happy to do this for her."

Would it be safe enough to assume that this situation is fairly typical of communication styles in his family?

If the cheque is made out to him, is it not pretty clear that he was to be the beneficiary? So, he could just lodge it and keep it?

Or follow up and ask for a proper explanation?

Or just do as his Mother asks?

mf
 
I'm afraid it is just do as mother ask, I don't want to start all out war over this with his family. she obviously paid the premiums on the policy over the years, I just cant understand why cheque is in his name. I just don't want any issue it coming through our joint account and back out again.

I never understood his Mother at the best of times. his parents have no money to speak of I have no interest in taking it, just something about it seems wrong.
 
My mum has one of these policies for myself ( & each of my siblings ). The policy is in my name, opened originally by my mum, so any monies from that policy would be issued to the person named on the policy - not the person who opened the policy.

I guess your concern Clara, is the fact that €10K+ is moving through your accounts which may set some flags off somewhere in relation to tax?
 
Clara16 said:
I never understood his Mother at the best of times. his parents have no money to speak of I have no interest in taking it, just something about it seems wrong.
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Are you sure the cheque is in your husband’s name ? If so he can just lodge it.

Why did your mother in law sign the back of the cheque ?

Is your father in law aware of this cheques existence ?

Is it possible the cheque is made out to your in laws, say Paddy & Biddy Murphy, but Biddy wants the cash without Paddy knowing ?
 
twofor1 said:
Is it possible the cheque is made out to your in laws, say Paddy & Biddy Murphy, but Biddy wants the cash without Paddy knowing
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No bank would handle such a cheque if not lodged to account of the joint payees.
This transaction appears to be exactly what it says on the tin. However if the mother took out a policy on the life of her son normally the policy owner would be the mother and the cheque should be made out to her. It appears strange that the cheque is payable to the son unless he is the policy owner. In which case he would have been involved in the setting up of the policy. 10k is a significant SV on a life policy and also raises some questions as to the nature of the policy. Take a look at the documentation that was supplied with the cheque to obtain some clarity.
There should be no tax implications for your husband in this transaction as he did not fund the premiums.
 
I thought it more a case that Biddy may have taken out the policy and paid the premiums over the years unbeknownst to Paddy and now wants to retain the proceeds without alarming Paddy unduly, particularly given that money may have been tight over the years as alluded to by the OP.
 
Jazz01 said:
My mum has one of these policies for myself ( & each of my siblings ). The policy is in my name, opened originally by my mum, so any monies from that policy would be issued to the person named on the policy - not the person who opened the policy.

I guess your concern Clara, is the fact that €10K+ is moving through your accounts which may set some flags off somewhere in relation to tax?
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Same here and as the OP mentions that the parents don't have much money to speak of, maybe this is why she cashed in the policy.
 
cheque is definitely 100% in my Husbands name, its at home no paper work is attached. I will look again this evening to see if life company name is attached. Husband has just told me they plan to give the money to his brother is help with house deposit. have no idea why mother in law left the need to sign Husbands name on the back. I'm just not happy with the money moving through our accounts.

Husband said she had a policy for each of the children he is the youngest and had hoped to give the money to each of them when they were 35, she ( or in this case the other brother) needs it more!

I'm only married in, not blood related thankfully!

do you think its ok to move money through accounts?
 
Clara16 said:
do you think its ok to move money through accounts?
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There should be no issue of concern re moving the money into your husband's account or your joint account. Explanation seems fine and funds would be effectively belonging to your MIL. Name on cheque is not an issue to be concerned about in this instance unless you suspect that your MIL is not being honest with you!!!
 
44brendan said:
There should be no issue of concern re moving the money into your husband's account or your joint account. Explanation seems fine and funds would be effectively belonging to your MIL. Name on cheque is not an issue to be concerned about in this instance unless you suspect that your MIL is not being honest with you!!!
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????????????? Why the post so?????????
 
There shouldn't be any tax issues, so forget about that.

No CAT for him, or her, and tax on growth was dealt with at source with no obligations to return information.

I'd just give her the money and forget it.
 
Why does your husband not simply sign the back of the cheque and give it back to his mother?

There is a good chance that her bank will allow her lodge it then.

Brendan
 
moneybox said:
I would be pretty peeved off if a policy meant for me went to my sibling instead :(
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Don't start a war!

The mother paid the premiums, it's her money, as there are no tax implications this is a really simple query.

If the mother, who has little money is helping out a sibling in need it's a good thing, no doubt she would have done the same for Clara's husband if he was in similar circumstances.
 
As long as there is a paper trail then there is no issue should the revenue ask questions later. The only time this may arise is when the brother has to explain to the bank where he got the deposit from. They may red flag revenue but all is fine and can be explained.
 
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