Ex-employer paid money via BACS by mistake into my account!?

Question

Am I obliged to declare that they have paid me a full months salary when I'm not entitled to the money as I no longer work for them? It appears to be a payroll dept mistake! Wondered if it will be picked up at audit around new tax year - does anyone know where I legally stand with this one?
Any relevant/sound advice would be appreciated :)

Answer 1

First of all, are you absolutely sure you weren't due the money anyway? Maybe some sales commision that is paid annually or the like.

Either way, you're not obliged to declare it. Leave it where it is and see what happens. Although the chances of them reclaiming it really are minimal, you want to be able to pay them back if they do ask for it.

However, you can still make the most of it without spending it: buy some dividend bonds (which you can cash any time) or put it in a high interest savings account. (Make sure it doesn't have restrictions on withdrawals)

You haven't stolen the money, so you can't be prosecuted. As you don't know it is a legitimate payment or not, it is the company's responsibility to find it rather than yours to tell them it is there.

When I was working for BMW in the UK through an agency, this happened to lots of people, including myself twice. In common with everyone else, my attitude was: if they want their money back, they know where to find me. Even after 3 years, I heard of nobody being asked to repay the money.

Oh, and mine's a pint of KilKenny if you see me down the pub!

Answer 2

Technically, from a legal perspective, if you realise that someone has paid or given you too much money, be it in a shop or over payment of wages then you can be charged with theft. Generally though it would be hard to prove unless it was a large amount which this might be.

It is unlikely, if its a big firm that they will notice this overpayment if it is a one off but if they start doing it every month they will realise eventually.

Answer 3

Legally, its theirs. You have to return it if they ask for it. You don't have a duty to notify them.

I had this same thing happen to me. Thinking they would figure it out eventually, I tried to tell them and get them to take the money back.

I TRIED and TRIED to get them to take it back. They didn't seem to have a program in place for doing that. No one knew what to do or how to do it. No one would take responsibility.

You will have to pay taxes on it. I did. At tax time, I ended up deciding to keep it because there was no way I could not pay taxes on it. I figured, if I have to pay taxes on it, it's mine.

Now I guess I'm never giving it back because I've stopped trying to return it and no one has contacted me.

Legally speaking, however, it's still their money. They can sue me for it until the statute of limitations runs out. I'm not sure how the tax thing works then. I could probably file an adjustment for that year. Or I could countersue for the amount I had to pay in taxes, meaning I'd have to pay them back minus the amount I paid in taxes.

Answer 4

it will be picked up eventually.

I remember once that the Government paid benefits twice into peoples bank accounts, and they tried to get this money back but alot of people refused so that had to wipe the debt out.

But honestly not sure legally, if they have a decent accounts department this will be picked up through audit, don't spend it though....it would burn a hole in my pocket lol lol

Answer 5

You are not obliged to inform them, but once they find out and ask for it back you must pay it back within a reasonable time.

Answer 6

personally i'd let them know as as soon as they pick up on the mistake they will prob ask for it back so u may as well let em know and if they do want it back the moneys there and u dont have to find it as u'd of spent it :-)

Answer 7

you should tell them or keep it in your bank until they realise and contact you

(if its a really big company they may never know or realise)

i would spend it but i am naugty