Information & Advice
Information and answers to common questions about changes to Child Trust Funds.
On 24th May 2010 the Government announced that it intends to reduce and then stop all government contributions to Child Trust Funds. The following provides further details of the planned changes for customers.
Subject to legislation, the Government intends to reduce government contributions at birth, and to stop government contributions at age 7, from 1 August 2010. The Government also intends for HMRC to stop issuing new Child Trust Fund vouchers for children born from 1 January 2011.
Legislation is required to implement the Government’s intentions and until that legislation is in place the procedure for new Child Trust Funds will continue as currently, except that the value of vouchers issued for children born from 1 August to 31 December 2010 will be £50.
For the present:
A. Yes. You will be able to use it up to the expiry date shown on the voucher, and if you do not use it HMRC will open an account for your child and tell you about this. Your child’s Child Trust Fund will then operate in the same way as existing Child Trust Funds, subject to the changes detailed above.
A. Yes. There are no plans to change anything here - family and friends will still be able to contribute up to a total of £1,200 into a Child Trust Fund account each year between them.
A. Yes. There are no plans to change anything here – existing Child Trust Fund accounts will continue to benefit from tax efficient investment growth and the payout at 18 will still be free from personal taxes.
A. No. There are no plans to change anything here – no withdrawals will be permitted until the child turns 18, and then only by the child.
A. The Government intends to reduce government contributions from 1 August 2010, and then stop them altogether from 1 January 2011. Subject to the relevant legislation being approved by Parliament, the Government intends:
A. No. You can apply for a replacement voucher at the Child Trust Fund website at www.childtrustfund.gov.uk
A. Yes, if your child is born before 1 January 2011 and you meet the other eligibility requirements (you make a valid Child Benefit claim for your child who lives in the UK and is not subject to immigration control).
A. When the relevant legislation is in place, the Government intends that HMRC will no longer issue vouchers and it will not be possible to open a Child Trust Fund account (other than for those who have already received a voucher before this date).
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