I received a tax refund cheque from the UK - unfortunately, in Pd Sterling. NO local bank was will ing to accept this cheque - one minor one (BOQ) offered to get it verified in the UK by sending it back there! All other local branches said 'we stopped dealing with cheques 1 - 2 years ago". – I was NEVER notified of this change by any of the banks I deal with; why was this allowed to happen? And, what can I do as an 82 year old with hearing problems and no email addresses provided by UK Departments - only phone nos.?
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You may have erred in relation to tax refund payment option, as direct debit to a bank account is now possible:
While it might not help you this year, it is something to explore if you need to lodge tax returns in future years.
Cheques usage and cashing options will cease in Australia in coming years:
Many banks are already phasing out cheques. Our own bank has phased out cheque accounts where cheques haven’t been used in the past 12 months. Other banks are following and soon in Australia cheques will be ancient history.
The complication you have is it is also a foreign issued cheque in a foreign currency… and why setting up direct debits in the future will be critical.
This HMRC website page has a postal address for contact which may be useful to you…
Possibly ask if you can return the cheque so it can be cancelled and paid into a nominated bank account by direct debit.
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The resources I found indicate that is only for UK accounts, not foreign. The US IRS is the same. Domestic account for direct deposit or a ‘check’ or for foreign they send a ‘check’, no alternative.
The only way around is being able to open a domestic account (often impossible without local presence) or having family or a trusted friend to deposit the cheque and transfer the funds in $AUD.
Has the UK moved on?
In the US context it is incongruous because the US social security pension is direct deposited to an Australian account in $AUD!
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I live in Australia! HM Revenue & Customs only gave me the option of nominating an UK bank a/c within 21 days of date of letter! I received it afterwards and I do NOT have an UK bank account.
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I should add: I receive a pension from the UK and that is sent electronically to my nominated account, and I was not given any other option for the taxation refund.
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The internet suggests that the big banks have all walked away from offering a service to convert and deposit foreign cheques. The smaller banks and building societies seem more accommodating. However there may be a time delay to complete the processing of weeks rather than days, and a service fee.
As well as the BOQ which you mentioned, another one of several I found on line with 2023 reference dates for the content.
It may pay to look at the alternatives if you expect a regular payment and open an account to minimise any future issues. It’s unlikely the big Australian banks will change their decisions no matter how inconvenient it is for their existing customers.
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HSBC also offers many services for ‘citizens of the world’ including foreign cheques. They quote 6 to 8 weeks to clear one. As with the minor banks the fees are very high. BOQ for example quotes $100-800!
Unless @gowinter 's refund cheque is substantial it might not be worth the aggro? Another option might be contacting the UK to have this year’s refund applied toward next year’s return. In the interim a reasonable way forward might be found?
This is a one-off refund! I’ve received advice that my request to pay all future tax in Australia has been successful.
I don’t plan to go through BOQ - one other option is via Macquarie Bank; have to send the cheque to Sydney… and hope. I was given an FOI email address to ask for help: have done so yesterday, not sure how long they take to respond (if at all).
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Are you sure?
Please note: We have stopped accepting foreign cheques as deposits into Macquarie bank accounts since 1 December 2020. You also cannot use cheques issued by us for payments overseas.
Some small banks will clear foreign currency cheques but only for existing customers and with high fees. You really have two problems, one being the cheque and the other being that you are a non-customer with a once-off requirement. If they will do the former at all they may not do it for a non-customer, or have even more significant fees attached.
In any case the cheque will almost certainly physically go to the UK and it will be a few weeks or even months before you get cleared funds.
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Hi @gowinter, from a scan @mark_m’s link to Great Southern Bank seems to be worth contacting and looks like a deal compared to the others I checked.
Don’t be surprised if they require you to open an account (with all the required ID verification) prior to accepting your cheque for collection. Looks like only a $15 fee (or $65 if over $5,000). Exchange rates would be irrelevant as compared to ‘getting it done’.
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I found this discussion interesting and helpful. I applied for a small tax refund from HMRC a few months ago. I did this manually (I don’t know why I didn’t think of online at the time) and the form didn’t have an option to pay into my bank account. But it did have an option for HMRC to send a cheque to someone of my choice. I got them to send it to a relative in the UK, who put it in their account and sent me the money. Of course, that depends on knowing someone in the UK.
I will look into doing it online next year, but at least I know I have the abovementioned option.
I don’t think you need an account with a UK bank, necessarily. I use Wise (formerly TransferWise) for any UK - Australia transactions and you can open one of those from here. It behaves like a bank account in UK and people (and companies) make deposits just as though it’s a UK bank.
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While ‘bank’ is commonly used in tax department verbage it normally means a ‘domestic financial institution that accepts direct deposits by EFT’, Refusing to make foreign EFT transfers probably reduces refund theft/scams to perps operating in the ‘home’ country where authorities might be able to intervene.
The difference between a tax refund (usually a once off transaction per annum) and a pension (usually a monthly/periodic transaction) paid by many countries through EFT to an international ‘bank’ in the target currency is the time it takes to notice a payment has not been received and to get whatever is happening fixed in as timely a manner as possible.
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Yes, and that option is allowed for receiving a tax refund. One can ask the refund to be deposited in a nominee’s bank account. If someone doesn’t have UK family or friends willing to do this, a professional such as a accountant/tax agent or solicitor may be willing to do this for a fee. Alternatively, there are UK businesses which offer to receive tax refunds for forwarding, but these also attract fees and reportedly are possibly the most expensive option.
That is another option worth exploring if the Wise deposit details are accepted as a payment option by HMRC. Wise is available for receiving tax refunds in some countries where one doesn’t have a local account (such as the US), but can’t find confirmation for the UK.
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The way cheque clearing was designed was the cheque you receive would be presented at the bank you wish to deposit at, and notionally deposited into your account subject to clearing. They would take all the cheques presented that day and sort them into batches by paying bank. These batches would then be taken to a clearing house, whereupon the cheques would be exchanged with the other participating banks. Since these batches would be all batched up, the inter-bank balances could be worked out, and the aggregate difference transferred to match the net value of the exchanges. The cheques would then go back to the branches to be deducted from the authorising account, or dishonoured and returned if there were insufficient funds.
That has since been automated. Electronic funds transfer does this automatically, in real time - save for some provisions to protect against fraud etc.
Cheque clearing can be done electronically, but it requires processing via the international interbank exchange system, SWIFT, which comes at a cost.
As advised by another post, I’d suggest you write to them and ask for an Electronic Funds Transfer (EFT) refund.
One option might be to look into a local mutual bank, one of the small, obliging ones, see if they would do the job for you, and open an account there. Not an ideal solution, I know, but I find the Regional Australia Bank (based in Armidale, NSW) very good to deal with.
I had a small refund from an oyster card paid through the local branch of a UK bank by TfL a couple of years ago. They did it all. To access their website and web based messaging service, I had to use my VPN set to a UK server but apart from that it all went like (electronic) clockwork.
It’s OK I think - Macquarie Bank agreed to accept and deal with it, I’ve sent the cheque. Thanks for all the suggestions - I hope I won’t have to deal with anything like this again! All tax will be paid in OZ from now on. Easier!
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Wish I’d seen some of these replies earlier! re Wise - never heard of that before and I was NOT aware that one can nominate - till I contacted a nephew in the UK, who did tell me that. But I’m still waiting for the letter from the UK Tax Office that (they said) was posted on 14 Dec. 23 telling me they could not do electronic transfers! This is such a debacle… I receive a monthly pension electronically from another department without any problems. And WHY will the UK not accept emails? Only (snail) mail or phone calls which I can’t make; I’m 83 and have hearing problems and prefer email.
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I contacted a nephew in the UK; they advised him (he phoned on my behalf) that the Tax Dept was not able to transfer funds using electronic methods. - Apparently they sent me another letter last December which I never received! My nephew told me that I could nominate him to receive the refund and he could transfer it. I have written to that effect using Registered Post, but OZ Post Office said that it might take some time to get there and there is no tracking on thnis smaller letter. Tracking cost 3 x as much! Sent last month…
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They’re probably going to reply saying you have to fill in a form!! I’ve just spent over 2 years getting a quote to enable me to pay the shortfall in my National Insurance contributions.
You can register for their App, however, if you live overseas you can’t use it as you need to provide 2 documents proving you have a UK residential address in order to use the App!
Whilst there is/are various separate teams who deal with people who live overseas you can’t use email, it’s either a letter or phone call.
When you do complete a necessary form they send a written reply which can take anywhere from 12-16 weeks to arrive in the mail box.
I would say that each time I’ve rung them they’ve answered in minutes and everyone has been extremely helpful. Really appreciated the fact you aren’t on hold for hours and the staff go above and beyond.
Hope you don’t need to fill in a form and that you get the monies very soon.
