Gift for deposit

irishbabe52

Hi folks,
Looking for some advice. My father is giving me 10k as a gift towards a deposit. Problem is he's over 80 and doesn't believe in banks so is giving it to me in cash!!
He has an irrational fear of putting his name to anything official, like a gift letter, and I don't want to push the issue with him.
Will the bank question me when I go to lodge it?
Would I be better getting my 2 siblings to lodge 5k each and say it's from them?
Obviously there's no tax issues here as it's well below any of the gift thresholds, I'm just wondering what's the best way to get it into my bank account without raising any red flags unnecessarily.

Brussels Sprout

I have lodged cheques for high 4-figure amounts to my account without any quesions being asked in the past.

The fact that it's cash might make it seem more dubious but I'm sure that people probably sell cars privately for cash and subsequently deposit that money frequently.
I'd maybe only deposit 9k though - just in case they have to question it if it's over 10k

BrokenArrows

irishbabe52 wrote: »

Hi folks,
Looking for some advice. My father is giving me 10k as a gift towards a deposit. Problem is he's over 80 and doesn't believe in banks so is giving it to me in cash!!
He has an irrational fear of putting his name to anything official, like a gift letter, and I don't want to push the issue with him.
Will the bank question me when I go to lodge it?
Would I be better getting my 2 siblings to lodge 5k each and say it's from them?
Obviously there's no tax issues here as it's well below any of the gift thresholds, I'm just wondering what's the best way to get it into my bank account without raising any red flags unnecessarily.

I deposited over 10k in cash from a car sale (about 10 years ago)
The teller didnt even bat an eye lid. Just counted it and deposited it.

If you are concerned then just deposit it in a few 2.5k amounts.

Doop

The bank wont query the money coming in, but they may query it as you are pulling together your deposit. We were quizzed on where money was coming from when showing funds to add to a mortgage as sale agreed price was over mortgage amount.

OP how much time do you have before your house purchase? If it were me I would probably put it in the credit union leave it sit, when time comes say it was from a car sale, or slowly feed it into the account over a few months.

You are allowed an annual cash gift from parent for €3k each year with no tax implication.

my3cents

Keep the cash and use it over the next few months to pay bills buy groceries etc, when its gone you should have an extra 10k in your account, just don't spend more than you would normally.

GooglePlus

my3cents wrote: »

Keep the cash and use it over the next few months to pay bills buy groceries etc, when its gone you should have an extra 10k in your account, just don't spend more than you would normally.

Not a bad shout, it would look like you've made a real committment to save and more likely to be a reliable customer for the bank.

jlm29

As above. The bank won’t question the lodgement, but might wonder where you came up with your deposit. The suggestion of keeping the cash is a bit crazy. What if you get broken into?

my3cents

jlm29 wrote: »

As above. The bank won’t question the lodgement, but might wonder where you came up with your deposit. The suggestion of keeping the cash is a bit crazy. What if you get broken into?

I agree not the best idea but an option that most people wouldn't think about. Obviously some risk but the father seems to have gotten away with it for many years.

10k isn't going to last most families very long say 4-6 months before its all gone. Problem is if everything is currently paid by direct debit leaving little opportunity to use the cash for everyday transactions. The other big problem with cash is its all too easy to spend.

Claw Hammer

The banks are obliged to question any lodgement over €1.5k. Things have tightened up a lot with anti money laundering. The only thing the /p can do is keep the money in cash and pay some of his normal expenses out of it and buy furniture and other things for the house out of the remainder after the closing.

Brussels Sprout

Not to mention that that plan won't work if the OP needs to have money in her account as proof of a deposit in the immediate future.

Claw Hammer

Brussels Sprout wrote: »

Not to mention that that plan won't work if the OP needs to have money in her account as proof of a deposit in the immediate future.

The o/p is going to need money over and above the deposit for legal fees and furniture.

wonski

Claw Hammer wrote: »

The banks are obliged to question any lodgement over €1.5k. Things have tightened up a lot with anti money laundering. The only thing the /p can do is keep the money in cash and pay some of his normal expenses out of it and buy furniture and other things for the house out of the remainder after the closing.

Never heard of that.

It is the mortgage application that is at risk here, not 10k lodgement.

I have no doubt any bank that queries such a relatively low amount of 1.5k. would be out of business after a month

antix80

Put it towards legal fees.
Try to use your own money for the deposit. It's not a big deal, but if you say the gift is towards the purchase of tbe house your dad might need to sign a few documents for the solicitor. The solicitor may also ask his source of funds.

Maybe lodge half to the credit union and half to the bank.

Claw Hammer

wonski wrote: »

Never heard of that.

It is the mortgage application that is at risk here, not 10k lodgement.

I have no doubt any bank that queries such a relatively low amount of 1.5k. would be out of business after a month

The banks are obliged to ask where the 10k came from when it is being lodged and report it to the revenue if it is suspicious. Years ago the banks asked no questions but now there are obliged to. As for banks going out of business most of them are broke. I have been asked many times about lodgements. The banks that asked me are still in business (with government support)
CRIMINAL JUSTICE (MONEY LAUNDERING AND TERRORIST FINANCING) ACT 2010

Claw Hammer

antix80 wrote: »

Put it towards legal fees.
Try to use your own money for the deposit. It's not a big deal, but if you say the gift is towards the purchase of tbe house your dad might need to sign a few documents for the solicitor. The solicitor may also ask his source of funds.

Maybe lodge half to the credit union and half to the bank.

The o/p has said his father doesn't want to sign anything. that is the cause of the thread.

antix80

Claw Hammer wrote: »

The o/p has said his father doesn't want to sign anything. that is the cause of the thread.

Well.. My advice still stands.. "if you say the gift is towards the purchase of the house your dad might need to sign a few documents for the solicitor".. So simply don't say the source of funds for the purchase of the house is a gift. Maybe it was proceeds from the sale of a car, or bertie ahern gave op a good tip on the ponies.

Claw Hammer

antix80 wrote: »

Well.. My advice still stands.. "if you say the gift is towards the purchase of the house your dad might need to sign a few documents for the solicitor".. So simply don't say the source of funds for the purchase of the house is a gift. Maybe it was proceeds from the sale of a car, or bertie ahern gave op a good tip on the ponies.

If he says it was from the sale of a car, what was the reg no? Who was the purchaser. When did he have the car insured from to. When did he buy the car? How did he pay for it? Bull**** stories to explain the source of €10k in an attempt to disguise the source of it are not going to fly ad could in fact lead to a charge of money laundering. This is the adult world.

wonski

Claw Hammer wrote: »

The banks are obliged to ask where the 10k came from when it is being lodged and report it to the revenue if it is suspicious. Years ago the banks asked no questions but now there are obliged to. As for banks going out of business most of them are broke. I have been asked many times about lodgements. The banks that asked me are still in business (with government support)
CRIMINAL JUSTICE (MONEY LAUNDERING AND TERRORIST FINANCING) ACT 2010

Someone said 1.5k requires this.

10k yes, not 1.5k

Actually you said this that any lodgement over 1.5k is a subject of anti money laundering regs so not sure what you are on about now...

Caryatnid

irishbabe52 wrote: »

Obviously there's no tax issues here as it's well below any of the gift thresholds, I'm just wondering what's the best way to get it into my bank account without raising any red flags unnecessarily.

But it is over the limit for tax, any one person (except your spouse) can only gift 3k max per year, before it is subject to tax (CAT).

This way, for example, you could ask your dad to give you 3k now, and 3k in 2020. Your siblings could also give you 2k each.

Happy to be corrected by anyone who is more knowledgeable than me. Best of luck with the house purchasing OP!

my3cents

Caryatnid wrote: »

But it is over the limit for tax, any one person (except your spouse) can only gift 3k max per year, before it is subject to tax (CAT).

This way, for example, you could ask your dad to give you 3k now, and 3k in 2020. Your siblings could also give you 2k each.

Happy to be corrected by anyone who is more knowledgeable than me. Best of luck with the house purchasing OP!

Isn't that 3k allowance apply to inheritance tax? So is only relevant if the father dies?

The whole point of the fathers reasoning for giving cash is probably to avoid paying tax.

Edgware

Just lodge it two days after Cheltenham

Claw Hammer

wonski wrote: »

Someone said 1.5k requires this.

10k yes, not 1.5k

Actually you said this that any lodgement over 1.5k is a subject of anti money laundering regs so not sure what you are on about now...

The banks ask about anything over 1.5k. !0k in cash would certainly be queried and most likely reported.

antix80

my3cents wrote: »

Isn't that 3k allowance apply to inheritance tax? So is only relevant if the father dies?

The whole point of the fathers reasoning for giving cash is probably to avoid paying tax.

Gift tax and inheritance limits are cumulative. If there's an inheritance down the line it may be relevant. Apart from that, the cash is needed now and it's being gifted now.
My advice isn't to hide it from the tax man, it's simply to avoid the op's father from having to sign docs relating to the house purchase from bank or solicitor pov.

Shamboo1801

Lodge it in €1000 batches, give or take a few quid, and you'll have your ten grand lodged in ten or twelve weeks. No questions asked

Claw Hammer

antix80 wrote: »

Gift tax and inheritance limits are cumulative. If there's an inheritance down the line it may be relevant. Apart from that, the cash is needed now and it's being gifted now.
My advice isn't to hide it from the tax man, it's simply to avoid the op's father from having to sign docs relating to the house purchase from bank or solicitor pov.

It is an offence to disguise the source of money. The bank and the solicitor will ask where the money is coming from. Telling infantile lies is not going to help and may cause serious problems.

wonski

Shamboo1801 wrote: »

Lodge it in €1000 batches, give or take a few quid, and you'll have your ten grand lodged in ten or twelve weeks. No questions asked

Questions might or might not be asked when applying for mortgage, unless it is at least more than 6 months away.

Keep the cash and spend less of your account, but make sure rent and other bills are coming out of it as normal.

Claw Hammer

Shamboo1801 wrote: »

Lodge it in €1000 batches, give or take a few quid, and you'll have your ten grand lodged in ten or twelve weeks. No questions asked

There is a suspicious pattern developing which will be queried. the o/p might get away with lodging a few irregular amounts over a period but no way 1k a week. The op will have to buy applicances and floor coverings and furniture as well as gardening tools after the purchase. It is far easier to buy them 1 at a time for cash avoid a paper trail.

Caryatnid

my3cents wrote: »

Isn't that 3k allowance apply to inheritance tax? So is only relevant if the father dies?

Re your question, nope, inheritance from a parent has a way higher threshold, thank goodness. However antix80 is correct in that the 3k could count towards inheritance.

Info here (sorry, no way to make this clickable) on both gift and inheritance tax, in case anyone is interested:
https://www.revenue.ie/en/gains-gifts-and-inheritance/gift-and-inheritance-tax-cat/index.aspx

wonski

Claw Hammer wrote: »

The banks ask about anything over 1.5k. !0k in cash would certainly be queried and most likely reported.

Do they? Based on what?

Haven't lodged in a while, but 10k seems to be the magic number.

hawkelady

Claw Hammer wrote: »

The banks ask about anything over 1.5k. !0k in cash would certainly be queried and most likely reported.[/quote

Utter lies ... this is not factual at all. €1.5k is peanuts and no bank queries lodgments of that small size...
€10k might trigger the odd query but that’s not 100% either.
O/p. You have nothing to hide at all. Best bet is lodge it in installments over the course of 3/4 weeks and no one will raise an eyebrow.
Good luck with house purchase

tricky D

Our solicitor had us sign anti-money laundering documents which required explanations about the sources.

Depositing in smaller installments is called smurfing or structuring and Revenue/banks are clued on to it.

My advice is to be up front with the bank and get their advice on how to proceed. They might well be fine with just an explanation and no signing.

Though 7k of the 10k will have to be taxed at inheritance time.