Thousands of young people in the UK may be entitled to unclaimed savings, according to a recent alert from HM Revenue and Customs (HMRC). The warning focuses on Child Trust Funds (CTFs), with many accounts still uncollected despite being set up years ago.
If you were born between September 1, 2002 and January 2, 2011, there is a possibility that a savings account exists in your name. These funds were created as part of a government initiative and, in some cases, may now hold substantial amounts.
Child Trust Funds were introduced to encourage long-term saving for children. Eligible individuals automatically received an account, often with an initial government contribution. Family members and friends could also add money over time.
However, as the scheme ended in 2011 and many years have passed, a large number of these accounts have been forgotten or misplaced. HMRC estimates that millions of pounds remain unclaimed.
For many young adults, especially those who have recently turned 18, this could represent an unexpected financial resource.
Eligibility
The eligibility criteria for these accounts is straightforward and based primarily on date of birth.
You may have a Child Trust Fund if you were:
- Born between September 1, 2002 and January 2, 2011
- Living in the UK during that period
- Eligible under the government scheme at the time
Once the account holder turns 18, they gain full access to the funds. There is no tax to pay on withdrawals, including any interest or investment gains.
From age 16, individuals can take control of the account, though withdrawals are only permitted at 18.
Value
The amount held in each Child Trust Fund varies widely. It depends on factors such as initial deposits, additional contributions, and investment performance over time.
Here is a general overview of how balances may have grown:
| Factor | Impact on Fund Value |
|---|---|
| Government contribution | Initial starting balance |
| Family deposits | Increased savings over time |
| Investment growth | Potential long-term gains |
Parents and guardians were allowed to contribute up to £9,000 per year. As a result, some accounts may now contain significant sums, potentially reaching thousands of pounds.
Access
Accessing the funds is relatively simple once the account holder reaches adulthood.
Key points include:
- Full withdrawal allowed at age 18
- No tax on interest or profits
- Account belongs solely to the child
This means the funds can be used freely, whether for education, housing, or other financial needs.
Tracking
One of the main challenges is that many people do not know where their account is held. HMRC provides a solution through its online tracking service.
To locate a Child Trust Fund, you will need:
- National Insurance number
- Personal identification details
Once a request is submitted, HMRC will identify the provider and respond by post, usually within three weeks.
This process helps reconnect account holders with funds that may otherwise remain unused.
Scheme
The Child Trust Fund scheme officially closed in 2011 and was replaced by Junior ISAs. However, existing CTF accounts are still active and continue to earn returns.
It is important to note:
- You cannot hold both a CTF and a Junior ISA at the same time
- Funds can be transferred from a CTF to a Junior ISA if desired
Despite the scheme’s closure, the money remains secure until claimed by the account holder.
Importance
As more individuals within the eligible age group turn 18 each year, HMRC is encouraging people to check whether they have an account.
Failing to do so does not mean the money is lost, but it may remain unused at a time when it could be financially beneficial. For many young adults, this could provide support during key life stages such as higher education or entering the workforce.
Taking a few minutes to check could uncover savings that have been accumulating for years.
FAQs
Who qualifies for a Child Trust Fund?
Those born between Sept 2002 and Jan 2011.
When can I access my CTF money?
You can withdraw it fully at age 18.
Is there tax on CTF withdrawals?
No, withdrawals are tax free.
How to find a lost CTF account?
Use HMRC’s online tracing tool.
