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Payment into bank account of non-existent company

Discussion in 'General Business Forum' started by MassiveTests, Mar 6, 2017.

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  1. MassiveTests

    MassiveTests UKBF Contributor Free Member

    56 2
    Hi guys,

    I have an open UK business bank account for a UK business which I have since closed.

    I am performing work for one of my overseas businesses however setting up the bank account is a slow process which is not yet finalised.

    I need to raise a substantial invoice to be paid in the near future.

    Are there any issues with me receiving payments into a UK business bank account for an overseas limited company?

    My understanding is that there are no issues as long as the accounting is performed correctly for corporation tax in the jurisdiction of the issuing company?
     
    Posted: Mar 6, 2017 By: MassiveTests Member since: Nov 3, 2015
    #1
  2. StevensOnln1

    StevensOnln1 UKBF Big Shot Free Member

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    Does the UK bank account belong to a limited company or did you open it as a sole trader?
     
    Posted: Mar 6, 2017 By: StevensOnln1 Member since: Dec 10, 2011
    #2
  3. MassiveTests

    MassiveTests UKBF Contributor Free Member

    56 2
    It belonged to a UK limited company.
     
    Posted: Mar 6, 2017 By: MassiveTests Member since: Nov 3, 2015
    #3
  4. STDFR33

    STDFR33 UKBF Big Shot Free Member

    4,520 1,203
    If the money goes into the bank account of a dissolved company, you risk the bank freezing the account after the funds have gone in.

    You would need to spend a lot of money doing an administrative restoration to gain access to those funds.

    Get it paid into a personal active if you need the funds.
     
    Posted: Mar 6, 2017 By: STDFR33 Member since: Aug 7, 2016
    #4
  5. MassiveTests

    MassiveTests UKBF Contributor Free Member

    56 2
    The company was struck off the company registry recently. The UK company has never traded/had any assets so not been dissolved and the bank has not yet been informed that the company is closed.

    It would purely be for this lone payment......
     
    Posted: Mar 6, 2017 By: MassiveTests Member since: Nov 3, 2015
    #5
  6. STDFR33

    STDFR33 UKBF Big Shot Free Member

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    Do it at your own risk then. I've already told you the risks.
     
    Posted: Mar 6, 2017 By: STDFR33 Member since: Aug 7, 2016
    #6
  7. bovine

    bovine UKBF Ace Free Member

    1,191 255
    If the company is struck off the registry, the company is dissolved. Do not pay any money into that account unless you want to risk it being frozen. The company doesnt exist so cant control the money. It could end up going to the government.
    Dont do it, dont do it, dont do it. Clear :)
     
    Posted: Mar 6, 2017 By: bovine Member since: Aug 23, 2007
    #7
  8. MassiveTests

    MassiveTests UKBF Contributor Free Member

    56 2
    Thanks guys, sound advice from both. Looks like I'll use personal account.

    Just for my own inquisitiveness, and maybe naivety; how would the bank know to freeze the funds?
     
    Posted: Mar 6, 2017 By: MassiveTests Member since: Nov 3, 2015
    #8
  9. bovine

    bovine UKBF Ace Free Member

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    I dont know the exact mechanism they use, but the company being dissolved is public knowledge and is published in the London Gazette (online). So presumably a feed from that.
     
    Posted: Mar 6, 2017 By: bovine Member since: Aug 23, 2007
    #9
  10. STDFR33

    STDFR33 UKBF Big Shot Free Member

    4,520 1,203
    The company is dissolved. The bank must freeze the account and pass any funds to the crown.

    Start here for more info:
    https://www.gov.uk/government/organisations/bona-vacantia/about
     
    Posted: Mar 6, 2017 By: STDFR33 Member since: Aug 7, 2016
    #10
  11. MassiveTests

    MassiveTests UKBF Contributor Free Member

    56 2
    Don't like the sound of that !!!
     
    Posted: Mar 6, 2017 By: MassiveTests Member since: Nov 3, 2015
    #11
  12. Chris Ashdown

    Chris Ashdown UKBF Legend Free Member

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    Also a risk that the personal bank may freeze the account for money laundering checks on large transfers of money into a account so best to explain to the bank before the transfer what its all about and check they are happy
     
    Posted: Mar 6, 2017 By: Chris Ashdown Member since: Dec 7, 2003
    #12
  13. MassiveTests

    MassiveTests UKBF Contributor Free Member

    56 2
    Thanks for the heads up on that.

    Do you know if it would ever cause any issue at the clients end? IE receiving invoice from X Company Limited with bank details for Mr xxxxx xxxx rather than a company bank account?
     
    Posted: Mar 9, 2017 By: MassiveTests Member since: Nov 3, 2015
    #13
  14. StevensOnln1

    StevensOnln1 UKBF Big Shot Free Member

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    How would the client know who the bank account belongs to when they only need the sort code and account number to pay you?
     
    Posted: Mar 9, 2017 By: StevensOnln1 Member since: Dec 10, 2011
    #14
  15. Chris Ashdown

    Chris Ashdown UKBF Legend Free Member

    11,960 2,491
    Bigger companies may question why as it could look like fraud and again the bank may want to know, no doubt they have read the Gazette by now so know there is a problem with the company

    Just talk to the bank beforehand and explain the problem no doubt they will agree, it's when you hide things people think the worst
     
    Posted: Mar 9, 2017 By: Chris Ashdown Member since: Dec 7, 2003
    #15
  16. MassiveTests

    MassiveTests UKBF Contributor Free Member

    56 2
    Hi,

    no problem with the company I'm invoicing from (there wasn't a problem with the UK company either) and I doubt the client has read the gazzette because the client is 4000 miles away from the UK....

    So I guess on the invoice I'll just put bank name, address and SWIFT code and account number. They may ask the question about account if they want to pay by cheque, which I'll try to avoid
     
    Posted: Mar 10, 2017 By: MassiveTests Member since: Nov 3, 2015
    #16
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