Latest news with #ChildTrustFunds
Leader Live
a day ago
- Business
- Leader Live
Wrexham case as extent of unclaimed Child Trust Funds revealed
Almost half (46.1%) of that belongs to those from low-income backgrounds who may need the money most. As of the end of May, nearly 35,000 young people across the country are unaware of their accounts and don't have access to what is rightfully theirs, according to figures from The Share Foundation. The data comes as child poverty in Wales is set to reach its highest rate in 30 years, with the Joseph Rowntree Foundation warning that more than 34% of children could be living in low-income families by the end of the decade. The Share Foundation, a registered charity that runs Junior ISA and Child Trust Fund schemes for young people in care throughout the UK on behalf of the Department for Education, is calling for the government to introduce automatic release of HMRC-allocated Child Trust Fund money when recipients turn 21. Under the proposal, countersigned by former Minister Ruth Kelly and parliamentarians from both Houses, account providers would be required to close and pay out proceeds via Government National Insurance channels for all unclaimed HMRC-allocated matured Child Trust Funds. 'Child poverty is becoming one of the big issues of our time,' commented Gavin Oldham OBE, Chair of Trustees at The Share Foundation. 'We need to break the cycle of deprivation which is why, over the past 12 years, we have been committed to establishing starter capital accounts for young people in care and helping young people from low-income backgrounds access Child Trust Funds they never even knew existed. "These initiatives are delivering positive outcomes exactly when families need them most.' To date, The Share Foundation has matched more than 85,000 young people with their Child Trust Funds, recovering over £165 million for young adult account owners through its free search facility developed with HMRC and Child Trust Fund account providers. The charity's mission is to encourage and facilitate inter-generational rebalancing by providing young people from disadvantaged backgrounds with both material resources and life skills knowledge to achieve their potential in adult life. TOP STORIES TODAY One of those who has discovered that he was entitled to the funds was Corey Polley from Wrexham. The 20-year-old has been self-employed for the last three years, doing timber framing. About two years ago, he found out about the Child Trust Fund through a family member. He used the Share Foundation website to see where his fund was held, a process which took 'about a week'. He claimed around £800 which has paid for his tools which was really important for him in his job, as otherwise it would have been harder for him to progress his career with the tools he had before. He has since told his friends who have also claimed their money. Corey said: 'Finding out about this money has been a massive help. I had no idea it even existed and it came at the perfect time when I was starting out in my career. "So many young people like me still don't know the child trust fund exists, so The Share Foundation's proposal for young people to get their fund automatically paid when they turn 21 makes a lot of sense. It could give other young people the same head start I got.'
South Wales Argus
03-06-2025
- Business
- South Wales Argus
£69m unclaimed Child Trust Funds in Wales, charity says
In Wales alone, £69 million remains untouched in HMRC-allocated Child Trust Funds (CTFs), according to The Share Foundation. Nearly half of these accounts (46.1 per cent) belong to young people from low-income backgrounds. The Share Foundation is calling for automatic payments of these funds to eligible account holders once they turn 21. Gavin Oldham, chairman of trustees at The Share Foundation, said: "Child poverty is becoming one of the big issues of our time. "We need to break the cycle of deprivation which is why, over the past 12 years, we have been committed to establishing starter capital accounts for young people in care and helping young people from low-income backgrounds access Child Trust Funds they never even knew existed. "These initiatives are delivering positive outcomes exactly when families need them most." The charity has already helped more than 85,000 young people access at least £165 million in matured CTFs.
Scottish Sun
04-05-2025
- Business
- Scottish Sun
HMRC issues warning to people with a hidden bank account that they could be missing out on up to £2,200
HMRC has issued a new warning to millions of young people who could be missing out on £2,200 which is being held in a forgotten bank account. Child Trust Funds are a type of long-term tax-free savings account that was set up for every child born between September 1, 2002 and January 2, 2011. 1 Thousands of young people could be missing out on £2,200 according to HMRC Credit: Getty It is thought that £1.4billion which belongs to 728,000 young people is sitting in Child Trust Funds waiting to be claimed. But many young people do not know that the account exists or that they can now access the cash. HMRC has now issued a warning on social media website X to people born between 2002 and 2011 to check if they have one of the accounts. The post said: 'Born between 2002 and 2011? You may have a #ChildTrustFund, which can be cashed in as soon as you turn 18.' You can check if you have a Child Trust Fund online by visiting: To do so you must be aged over 16 or a parent. You will need your full name, National Insurance number, address and date of birth. If you are a parent who is looking for your child's account all you need is their full name, address and date of birth. The tool will identify who your Child Trust Fund provider is. It will not tell you how much money is in the Child Trust Fund. What Does My Tax Code Mean? A Simple Guide to Your HMRC Letter Once you have completed the form you will get a letter from HMRC with details of the Child Trust Fund provider. You will usually get this within three weeks of HMRC receiving your request, if you apply online. Postal applications will take a little longer. If you do not get a response within six weeks then write to HMRC. What is a Child Trust Fund? Child Trust Funds are long-term, tax-free savings accounts which were set up for every child born between September 1, 2002 and January 2, 2011. The Government paid in £250 for every child during that time period, or £500 if they came from a low income family. An extra £250 or £500 was paid in when the child turned seven, depending on their families' economic situation. In 2010, this was reduced to £50 for well off households and £100 for those on lower income. The scheme was scrapped in 2011 and later replaced with Junior Isas. Parents or friends can pay in up to £9,000 into the child's account tax-free and the money is usually invested into shares. But many parents did not continue to add money to the accounts after the scheme was scrapped and so many of the accounts were lost or forgotten. The savings are held in banks, building societies and other savings providers, not by the Government. The money stays in the account until it is withdrawn or re-invested. Young people can take control of their Child Trust Fund at 16 but can only withdraw funds when they turn 18 and the account matures. What should I do once I claim the money? Most people put the cash into a bank account, invest it or transfer it into an Isa. You can also ask your Child Trust Fund Provider to give you the money and get it paid into your bank account. If you do this you will need to provide the bank account details you wish to transfer the cash into with HMRC. If you would rather invest it, you can transfer it into an Isa. Do you have a money problem that needs sorting? Get in touch by emailing money-sm@ Plus, you can join our Sun Money Chats and Tips Facebook group to share your tips and stories
The Sun
04-05-2025
- Business
- The Sun
HMRC issues warning to people with a hidden bank account that they could be missing out on up to £2,200
HMRC has issued a new warning to millions of young people who could be missing out on £2,200 which is being held in a forgotten bank account. Child Trust Funds are a type of long-term tax-free savings account that was set up for every child born between September 1, 2002 and January 2, 2011. 1 It is thought that £1.4billion which belongs to 728,000 young people is sitting in Child Trust Funds waiting to be claimed. But many young people do not know that the account exists or that they can now access the cash. HMRC has now issued a warning on social media website X to people born between 2002 and 2011 to check if they have one of the accounts. The post said: 'Born between 2002 and 2011? You may have a #ChildTrustFund, which can be cashed in as soon as you turn 18.' You can check if you have a Child Trust Fund online by visiting: To do so you must be aged over 16 or a parent. You will need your full name, National Insurance number, address and date of birth. If you are a parent who is looking for your child's account all you need is their full name, address and date of birth. The tool will identify who your Child Trust Fund provider is. It will not tell you how much money is in the Child Trust Fund. What Does My Tax Code Mean? A Simple Guide to Your HMRC Letter Once you have completed the form you will get a letter from HMRC with details of the Child Trust Fund provider. You will usually get this within three weeks of HMRC receiving your request, if you apply online. Postal applications will take a little longer. If you do not get a response within six weeks then write to HMRC. What is a Child Trust Fund? Child Trust Funds are long-term, tax-free savings accounts which were set up for every child born between September 1, 2002 and January 2, 2011. The Government paid in £250 for every child during that time period, or £500 if they came from a low income family. An extra £250 or £500 was paid in when the child turned seven, depending on their families' economic situation. In 2010, this was reduced to £50 for well off households and £100 for those on lower income. The scheme was scrapped in 2011 and later replaced with Junior Isas. Parents or friends can pay in up to £9,000 into the child's account tax-free and the money is usually invested into shares. But many parents did not continue to add money to the accounts after the scheme was scrapped and so many of the accounts were lost or forgotten. The savings are held in banks, building societies and other savings providers, not by the Government. The money stays in the account until it is withdrawn or re-invested. Young people can take control of their Child Trust Fund at 16 but can only withdraw funds when they turn 18 and the account matures. What should I do once I claim the money? Most people put the cash into a bank account, invest it or transfer it into an Isa. You can also ask your Child Trust Fund Provider to give you the money and get it paid into your bank account. If you do this you will need to provide the bank account details you wish to transfer the cash into with HMRC. If you would rather invest it, you can transfer it into an Isa. .
Telegraph
26-03-2025
- Business
- Telegraph
Time is running out to use the tax loophole that lets parents stash £36,000 into an Isa
With the end of the tax year just around the corner, many parents are keen to maximise tax allowances and save for their children's future, particularly given speculation that Isa allowances could soon be cut. But if your child has a Child Trust Fund, you might be able to take advantage of a quirk in the system that could see you stash away up to £36,000 for your child tax-free – far exceeding the usual £9,000 annual Junior Isa limit. However, you'll need to act quickly as there's very little time left to make the most of this tax tip. This Telegraph Money guide will cover: Who is eligible for the children's saving trick? How to do it Is switching to a Junior Isa worth it? Who is eligible for the children's saving trick? According to stockbroker AJ Bell, the strategy involves using both a Child Trust Fund and a Junior Isa. This means that to be eligible your child must already hold a Child Trust Fund. Child Trust Funds were set up by the Government for children born between September 2002 and January 2011. They currently hold £10.5bn worth of savings, according to the National Audit Office, and many people, now adults, don't realise they have money stashed away. Junior Isas replaced them in 2011, and those with the old accounts have the option of transferring their balance across to the Isas – you can't hold both simultaneously. Up to £9,000 can be paid into either a Child Trust Fund or a Junior Isa each year. However, while the annual allowance for Junior Isas renews on April 6 at the start of a new tax year, the annual allowance for Child Trust Funds renews on your child's birthday. This means that if your child's birthday falls before the end of the tax year on April 5, you could potentially save £9,000 before their birthday, another £9,000 just after their birthday, and then transfer the funds to a Junior Isa to take advantage of its allowance. Isas are one of Britain's favourite ways to save because anything inside an Isa, whether savings or investments, grows free of savings, capital gains and dividend tax. Withdrawals are also tax-free. How to do it Let's say your child's birthday is March 28, and they hold a Child Trust Fund. If you have the money available, you could pay £9,000 into their account on March 27, followed by another £9,000 on March 29 after your child's birthday when the allowance resets. You could then transfer the pot to a Junior Isa on March 31. If the transfer completes in time (some providers may take a couple of weeks to complete the process), this gives you a brand-new allowance of £9,000 to use before the end of the tax year, bringing your total contribution to £27,000. Come April 6, you'll be able to use the new Junior Isa allowance of £9,000, meaning you'll have stashed away a total of £36,000 for your child completely tax-free. Of course, there are a few caveats to be aware of. First, you'll need to be able to afford to put away £36,000 over the next week or so. Second, whether you can take advantage of this loophole in full depends on the date of your child's birthday. If your child's birthday falls just before the end of the tax year in April, it's unlikely you'll have enough time to make two contributions to the Child Trust Fund and transfer the account to a Junior Isa before the start of the new tax year. Even if your child's birthday is in March, you may find that transferring the CTF to a Jisa takes you beyond the start of the new tax year, in which case you won't be able to pay in the Jisa allowance of £9,000 before April 6. But even so, making this switch still gives you a chance to tuck away £18,000 now, and a further £9,000 in the new tax year. Is switching to a Junior Isa worth it? Whatever your situation, if your child currently has a Child Trust Fund, it may be worth transferring those funds to a Junior Isa, where there is more choice of accounts and options are generally more competitive. One question you need to ask yourself is whether to open a Junior cash Isa or a Junior stocks and shares Isa. The younger your child is, the more likely it is that their savings will ride out the volatility of the stock market and deliver better returns over a long period of time. Charlene Young, pensions and savings expert at AJ Bell, said: 'Even if a family cannot make full use of the £36,000 loophole, many young people who have Child Trust Funds but are still under 18 would benefit from a transfer to a Junior Isa anyway, where the charges will likely be lower, and they'll have a much wider investment choice.' The money must be locked away until the child turns 18, at which point the Junior Isa is automatically rolled over into an adult Isa. The child can access their money if they wish to or continue saving for their future. Ms Young said: 'Although Junior Isa rules state that accounts must be set up and managed by a parent or legal guardian, anyone can pay money into it as a gift. 'This makes them especially useful for grandparents looking to make use of gifting allowances with frozen inheritance tax thresholds until 2030, and the prospect of unused pensions being brought into the value of their estates, too.' If your child already holds a Junior Isa, it's not possible to use a Child Trust Fund. Instead, there is still time to use up this tax year's allowance of £9,000, before the new £9,000 allowance kicks in on April 6. These savings can soon add up. A parent managed to save the full £9,000 Isa allowance every year into a Junior cash Isa paying a 1.5pc interest rate, then by the time the child turned 18, the account would be worth £187,170.
