Teenagers to get access to Child Trust Funds
Children born after 31 August 2002 and before 3 January 2011 were entitled to a Child Trust Fund (CTF) account provided they met the necessary conditions. These funds were long-term saving accounts for newly born children. The first of these children will begin turning 18 from 1 September 2020.
HMRC has confirmed that millions of teenagers are set to benefit as their accounts mature. Approximately 6.3 million CTF accounts have been set up since the scheme was launched in 2002, roughly 4.5 million by parents or guardians and a further 1.8 million set up by HMRC where parents or guardians did not open an account.
From September, an estimated 55,000 accounts will mature each month and HMRC has created a simple online tool to help young people find out where their account is held.
Economic Secretary to the Treasury, John Glen, said:
‘We want to make sure all young people can access the money which has been set aside for them, to invest in their future and continue a savings habit, as they turn 18.’
If you’re unsure if you have an account or where it may be, it’s easy to track down your provider online.
The actual CTF accounts are not held by HMRC, but by a number of CTF providers who are financial services firms. Anyone can pay into the account, with an annual limit of £9,000, and there’s no tax to pay on the CTF savings interest or profit.