Child trust fund (CTF) refers to long-term tax-free savings account for children in the UK. As mentioned here Gov.UK CTF is scheme is closed but you can apply in another scheme called Junior Individual Saving Accounts (ISA).

Already have a Child Trust Fund?

Junior Trust Fund

if you already have a CTF you don’t need to worry because you can continue to add up to £9,000 a year to your CTF account. The money in the child trust fund now belongs to the child that can only be taken out when they’re 18. The child can take control of the account when he/she becomes 16. There’s no tax on the CTF income or any profit it makes. It neither will affect tax credits or benefits you receive.

Junior Individual Saving Accounts (ISA)

  • Same as child trust fund Junior ISAs are long-term, Tax-Free Savings Accounts for Children in the UK. Currently, for the tax year 2020-2021, saving limits are set to £9,000 for Junior ISAs.
  • The requirements to get a Junior Individual Savings Accounts in the UK.
  • the child must meet the below
  • Under the age of 18
  • living in the UK

If your child is living outside the UK there is a possibility that he can also get Junior ISA  only if you are a Crown servent (like UK’s armed forces, diplomatic service, or overseas civil service) or your child depend on you for care.

Types of Junior ISAs

  1. cash Junior ISA, for example, you will not pay tax on interest on the cash you save
  2. stocks and shares Junior ISAs, for example, your cash is invested in shares or stocks if you get any capital growth or dividends on it, you will not have to pay tax on that.

A child can have one or both types of Junior ISAs.

  • Who can Open Junior Individual Saving Accounts
  • Parents or guardians with parental/guardian responsibility can open a Junior ISA and manage the account, during account management the money always belongs to the child.

Opening Junior ISA needs to :

  • Select the type of Junior ISA (cash/stocks & shares /or both)

Select your account provider (banks, building societies, credit unions, friendly societies and stockbrokers)
get an application form from them

The child can only have:

  • 1 cash Junior ISA
  • 1 stocks and shares Junior ISA

When will the child get the money?

The child can take control of the account when they’re 16, but cannot withdraw the money until they turn 18.


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