best savings account for kids?

suiko

Is it possible to get a better deal than the standard best deals for 3-4 years that are on the main site? My partner wants to open an account for her two kids, not tuoching the cash for a period of up to four years (it's actually a transfer from an existing account).

I'm just wondering if there's some special tax loophole that allows better rates for minors/non-taxpayers?

smithers1981

The best account i found was Lloyds Tsb young savers 3% interest, not sure about loopholes but it will be tax free unless kids earn over £7k q year in interest!

suiko

Thanks. Surely better to go with the top rates at 3.8/4%, though? Or are there any disadvantages in that?

GonnaNeedABiggerBoat

Does it have to be a different type of account for a child?

al25

GonnaNeedABiggerBoat wrote: »

Does it have to be a different type of account for a child?

Kids don't pay tax, that's the only reason I could think of.

emma-uk

Can you drip feed the money into the Halifax Kids Reg Saving Account which is currently paying 6%? They also have a fixed one at 4% for 5 years so around the timeframe your looking at.

http://www.halifax.co.uk/savings/accounts/

pinkdalek

emma-uk wrote: »

Can you drip feed the money into the Halifax Kids Reg Saving Account which is currently paying 6%? They also have a fixed one at 4% for 5 years so around the timeframe your looking at.

http://www.halifax.co.uk/savings/accounts/

If you have the lump sum available then drip feeding their regular saver does not earn you that much in interest. £100 per month at 6% makes about £35, if you did one of their fixed savers eg the five year one at 4% then it would be making more interest from day one and would earn you more in the long run and is less hassle.

Their regular saver is ideal if you are starting off from zero and want to put away an amount each month.

xylophone

See http://www.hmrc.gov.uk/tdsi/children.htm and note the '£100 rule' -this does not apply to CTF/JISA. Note the information about the R85 and what happens when a child turns 16.
http://www.direct.gov.uk/en/MoneyTaxAndBenefits/ManagingMoney/PlanningYourPersonalFinances/DG_10013916

You are not limited to accounts specifically for children - the adult can open any account that permits the "re" (bare trust) format - ask the provider.