Child Trust Fund

Children born between 1^st September 2002 and 2^nd January 2011, residing t in the UK qualified for a CTF. Parents or Guardians of eligible children were given vouchers worth between £50 and £250 to invest with their chosen CTF provider. Some children will have received multiple vouchers.

You can do this through HMRC where the account was originally opened. HMRC will send you details of the Child Trust Fund provider by post within 3 weeks of receiving your request.  You’ll need a Government Gateway user ID and password. If you do not have a user ID, you can create one when you fill in the online form.  HMRC will contact you for more information if you’ve adopted the child or a court has given you parental responsibility for them.

There were a large number of children who didn’t have an account opened before the voucher expired.  This could have happened for any number of reasons.  The good news is, if the child was eligible, a CTF was opened in their name by the Government. These are often referred to as Revenue Allocated Accounts.

Yes. There are three main types of CTF account:

• Stakeholder CTF: A Stakeholder CTF comes with a set of agreed requirements that define how the account must be managed. These include the types of investment funds the money can be placed in, capped charges, minimum investment amounts and methods of paying into the account. All Revenue Allocated Accounts (see above) were opened as a Stakeholder CTF Account.
• Non-Stakeholder CTF: These don’t have the same restrictions as their Stakeholder equivalent, meaning they can invest in higher risk funds, charges could be higher, and minimum investments are at the discretion of the individual provider and may differ between providers.
• Cash Account (deposit based): These types function like a bank account with a regular amount of interest applied.

No.  It is not possible to withdraw money from a CTF before the account holder turns 18, unless there are exceptional circumstances, such as terminal illness or death (please see Q18 & Q19 for further details).  CTFs can be transferred into a different type of CTF (see question above) or in to a Junior ISA. The CTF will mature on the date of the account holder’s 18^th birthday, when they can decide what they wish to do with the money. 

The child’s parent or guardian is able to control the account initially, but this doesn’t happen automatically. They will need to apply to become a Registered Contact on the account. At Unity Mutual, you do this by heading to our registered contact portal, but other providers may have different ways of applying for this. A registered contact can transfer the account, find out details of the amount held in the account, but cannot close or withdraw money from the account. Once the child turns 16, they can apply to become the Registered Contact, and their parent can be removed from the account.

This alters each year. Currently (2022-23) parents, family members and friends or even the child themselves can pay in up to £9,000 each year between them. A subscription year runs from the child’s birthday in one year to the day before their birthday in the following year.

No. To take control of your child’s account, you must have parental responsibility for the child and will need to complete an application to become the Registered Contact. Once they reach the age of 16, the parent can relinquish the Registered Contact responsibility, and the child can apply to become the Registered Contact. Should they not want to, you can continue to be the Registered Contact until they reach 18. However, a decision on what to do with the money on maturity of the account can only be given by the child.  

No.  No money can be withdrawn from the account until its maturity on the day of the child’s 18^th birthday.  Providers can only accept a decision from the account holder at this time, regardless of whether a parent has been the Registered Contact on the account since birth.    

There are exceptional circumstances where money may be withdrawn early, such as a terminal illness. (Please refer to Q18 for more details).

When HMRC allocated CTF accounts they were allocated to providers in rotation and they didn’t attempt to keep siblings together. If you’re unsure of which provider each of your children have accounts with, please refer to Q2.

Yes, that’s no problem. Although CTFs aren’t open to new business, it is possible to transfer an existing CTF account to another provider, the funds will be put into a Junior ISA. If you would like to move your child’s CTF simply contact your chosen provider and request a CTF Transfer Form. If you would like to transfer a CTF from another provider into our Junior ISA, you can either download our transfer form or request it by post, you can do this here.

This can vary between different providers – you will need to contact your current provider for more information. At Unity Mutual, it is possible to pay into a child’s CTF by Direct Debit, debit card, bank transfer or cheque. The minimum payment is £5. Payments are a gift to the child and cannot be returned to the payer. Anyone can pay into a Child Trust Fund account. The most that can be paid in is £9,000 in a 'Subscription Year' (birthday to birthday). All money paid into the account belongs to your child, who can only access it when they reach 18.

No, it’s not possible to open a CTF now as the scheme closed in 2011. However, there are alternative tax-free savings products for children such as a Junior ISA or a Tax-Exempt Savings Plan (TESP), which are only available through Friendly Societies. You can look at the Children’s savings products Unity Mutual offers here.

Please note, Unity Mutual cannot give you advice, we can only give you factual information. If you’re in any doubt about whether a product is right for you, it’s a good idea to talk to an Independent Financial Advisor (IFA), for unbiased advice on the best financial products for you, from a range of different companies.

Until your child reaches age 15, at Unity Mutual the money deposited into the account is invested to buy ‘units’ of investment within the Unity Mutual Equity Fund. These units are purchased at the unit price, which will be calculated at the next pricing date, which is every Monday. Unlike other unit priced funds, our fund is single priced, which means the buy and sell prices are always the same.

This Fund tracks the performance of the UK Equity market and follows the fortunes of over 600 UK companies whose shares can be bought and sold on the Stock Market. Spreading the investment over such a large group of companies reduces the risk of individual companies not performing too well.

Yes, the Registered Contact can transfer a Child Trust Fund account to us at any time, free of charge.

Whilst we do not accept transfers into our Child Trust Fund, we do accept transfers from an existing Child Trust Fund account into our Junior ISA.

To do this, if you’re the account correspondent, you can contact us or find our transfer forms here. Once we are in receipt of your completed form we will contact the other provider, once any cancellation period has expired, and arrange the transfer.

The Registered Contact has the right to cancel the transfer if they wish.

This depends on a number of things, such as how much has been paid in and the investment returns on the fund where the money is invested.

Please note as the money is invested in stocks and shares the value can fall as well as rise meaning your child could get back less than has been paid in.

101% of the value of the account will be paid to the person with parental responsibility for the child, following receipt of necessary evidences, such as their death certificate. You’ll need to ensure that you are the registered contact on the account in order to make these arrangements. If this applies to you, please contact us and we’ll help you get this arranged.

If this happens before the child is 18, then it may be possible to draw money out of the account for their benefit. You’ll need to ensure that you are the registered contact on the account in order to make these arrangements.  It is down to HMRC to determine if and how you will receive the funds if your child is terminally ill. If this applies to you, please contact us, and we’ll help you get this arranged.

Money held in a Child Trust Fund account is not subject to income or capital gains tax.

Under current legislation the child will not have to pay tax on money drawn out of a CTF account.

You can keep up to date with the value of your child’s CTF Account in the CTF Hub. Once you’ve become a registered contact, you’re free to log in any time, check the value and make any changes that you need to.