children's savings

steve2361

Hi all

Unfortunately my sister's husband died last month but fotunately has left her quite financially secure.
She is receiving a pension from his work but also will recieve a pension for each of her sons being paid seperate to her pension.
Whilst it has been relatively easily to sort her side out re investing etc, it doesn't seem so simple for her children !

Having no experience in these matters can anyone tell me if the money the children receive in their pension from dad is invested/put in savings is this money classed as a gift from their father and as such the £100 tax rule applies to interest ?

or even better if anyone could possible advise what is best to do with this money to be put away til they are both 18 ?

Many thanks in advance !!! :beer:

Steve

CLAPTON

children's tax affairs are exactly the same as for adults

the pension is taxable income just as for an adult
they have a tax free allowance of 6475 just as an adault does and then they pay 20% tax
if the money is saved or invested the rules are the same as for adults

how the money is used or saved depends upon the overall finances of the mother... does she need to use some of the money supporting the child?

steve2361

Thnaks for that

No mother doesnt need to use any of the money for the children , from what you say does that mean they can earn £6000 in interest before paying tax or will my sister be taked on any interest over £100 ?