Some people could unlock an unexpected cash boost before Christmas.
HM Revenue and Customs (HMRC) is urging people who have recently turned 18 to cash in their Child Trust Fund to unlock a Christmas boost worth £2,242 on average.
According to the government department, people born between September 1, 2002, and January 2, 2011, may have a Child Trust Fund waiting for them that they forgot about. Child Trust Funds are long-term tax-free savings accounts that were set up for children born during this period and up to £9,000 per year can be added to existing accounts. The money in the account belongs to the child, but they can only withdraw it once they turn 18. There is no tax to pay on the income or any profit the account makes, but once a child turns 18 then no more money can be added.
At this point they can opt to either take the money out or transfer it to an adult ISA, and their Child Trust Fund will then close. But crucially, until the money is withdrawn or transferred, the funds will stay in an account that no one else has access to.
The Child Trust Fund scheme closed in 2011 but HMRC is urging anyone who still has one – and has now turned 18 – to cash it in as it could be worth thousands of pounds.
In a post on X (formerly Twitter) this week, HMRC said: “Unlock a boost this Christmas by cashing in your Child Trust Fund. If you’ve turned 18 in the past few years, then you could be missing out.
“If you were born between 1 September 2002 and 2 January 2011 you may have a Child Trust Fund waiting for you! Find out more on GOV.UK.”
Latest figures from HMRC show that 758,000 matured Child Trust Fund accounts remain unclaimed, worth on average £2,242 each.
To track down a Child Trust Fund, you can contact the fund provider directly if you know who the account is with, or if not, ask a parent or guardian.
You can also ask HMRC to track it down and the department can tell you where the account was originally opened. To do this you must be a parent or guardian of a child under 18, or aged 16 or over and looking for your own trust fund.
It takes around five minutes to submit a request to find a Child Trust Fund using HMRC’s online tool and, for most, less than three weeks to hear back. You just need the young person’s National Insurance number and date of birth.
Shelley Doorey-Williams, CEO of the London Foundation for Banking & Finance, added: “As a committed member of the YFCG (Youth Financial Capability Group), the London Foundation for Banking & Finance welcomes HMRC’s call for young people to claim their Child Trust Fund savings.
“It’s encouraging to see the government making efforts to reunite people with money they may not even realise was theirs. With an estimated average of £2,242 waiting in unclaimed accounts, this is real money at a crucial time that can help young people right at the start of their financial lives.”
