Why can I not cash a business cheque?

W

Wishes

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I have been doing some construction work for a builder and while on site the other day I was told by the other workers to be careful of 'bounced cheques' I might be in receipt of on pay day.

I have registered as a sole trader as requested by the builder and have also registered a company name. The builder made the cheque out to the company name.

As cash is scarse I decided to go to the source of the cheque with all appropriate ID to have the cheque cleared there and then. His bank turned me away, saying a cheque made out to a company needs to be lodged in the recipients own bank account and cannot be cleared immediately.

As this is my first payment from this guy I am quite anxious.

Anybody know if what I was told at the bank is correct?
 
Thanks Wbbs. So my best bet would have been to have him write it out to me personally.
 
Still quite difficult to cash a cheque even if made out to yourself, you could try, he may not want to make it out to you and not the company name which is understandable too.
 
I'm not so sure about that. You could ask his bank to swap his cheque for either an Inter Bank Payment or a Bank Draft with all details, including the payee remaining the same. You would still have to lodge through your company account but at least you will know that payment is guaranteed.
 
Thanks for feedback guys. I went back to bank and did as you said Soylent but unfortunately there was no funds in his account to meet the cheque payment.

So its back to the drawing board errrr.
 
Really sorry for your problems in this, Wishes, but I thing that anybody in your situation accepting a cheque from a 'builder' in the current climate, without knowing for sure that the builder was solvent, is quite likely to be working for nothing. I know times are really hard for people working in the construction sector, but there has to be a limit to what people like you will accept, and a dud cheque is not one of them. So, maybe you might enlighten the Revenue officials in the Department of Finance about the dud cheque? If the builder is in business, then shining a light on his transactions might deter him from doing this again.
 
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