Home Information Online Services About Us Contact Us Blog Are your young adults missing out on their Child Trust Fund? Posted by siteadmin on Tuesday 2nd of November 2021. HMRC says many teenagers are missing out on Child Trust Fund cash. The first Child Trust Funds (CTFs) matured just over a year ago, at the start of September 2020. CTFs will continue to mature until January 2029 as their owners reach the magic age of 18. At present, about 55,000 CTFs mature every month. HMRC has been looking at the CTFs that have already matured. Its interest is more than academic because over the life of the scheme, HMRC set up one million CTFs – about 15% of the total. HMRC took the CTF establishment role when parents or guardians had failed to do so within 12 months of receiving a CTF government voucher. HMRC randomly allocated an approved CTF provider to each such orphan. In a recent press release, HMRC said “Hundreds of thousands of accounts have been claimed so far, but many have not”. Annoyingly – and perhaps deliberately – HMRC does not spell out specific numbers of non-claimants, but said if only 10 per cent miss the date, that amounts to over 5,000 a month. It should come as no surprise that many parents, guardians and children have forgotten that a CTF exists. To judge by data issued earlier this year, over 80% of CTFs are worth less than £2,500, with many probably only valued in the hundreds, having received no more than one voucher of £250 or £500 before government payments ceased. If you want to find a ‘lost’ CTF, the best starting point is HMRC’s online tool (see https://www.gov.uk/child-trust-funds/find-a-child-trust-fund). To use this, you will need to create a Government Gateway user ID and password if you do not already have one. CTFs that carry on beyond their owner’s eighteenth birthday continue to offer the same tax benefits as ISAs – no UK tax on income or capital gains. However, the underlying investments may be unattractive – deposits with minimal interest rates, for example. The same investment drawbacks can apply long before maturity, so it is worth reviewing any existing CTFs. A transfer to a Junior ISA (JISA) could be a better option than carrying on with a CTF. The value of your investment and the income from it can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. The value of tax reliefs depends on your individual circumstances. Tax laws can change. The Financial Conduct Authority does not regulate tax advice. « The not-quite post-pandemic Budget Blog Placing a cost on retirement » Archive November The Pension Annual Allowance Trap Placing a cost on retirement Are your young adults missing out on their Child Trust Fund? October The not-quite post-pandemic Budget September So, farewell then 6 April? August The £9 billion Child Trust Funds backwater July May A recent survey of people who have or plan to retire in 2021 provides interesting insights, whatever your intended retirement year April March A quiet turning of the tax screw February January Unique Financial Planning Ltd is Registered in England & Wales: Company Number 08996066. Registered Office: 1 Cricklade Court, Old Town, Swindon,Wiltshire,SN1 3EY The information on this website is subject to the UK regulatory regime and is therefore targeted at consumers in the UK. Copyright © 2021 Unique Financial Planning LOG IN