Best savings account for child

ice_babe

Im looking for a good savings account for my 7 year old. He currently has one with halifax but each year the interest rate goes down and I have to make an appointment to change his account.

He has a good amount saved up and dont need to be able to make withdrawals.

Thanks

marathonic

ice_babe wrote: »

Im looking for a good savings account for my 7 year old. He currently has one with halifax but each year the interest rate goes down and I have to make an appointment to change his account.

He has a good amount saved up and dont need to be able to make withdrawals.

Thanks

Have a look at this link:

http://www.moneysavingexpert.com/savings/junior-isa

ice_babe

Thanks, As my son has a child trust fund he cant have a isa

Just looked into his halifax savings account and the bulk of his money hes only getting 1.05% gross. He also has an regular saver which pays 6% but only for 1 year and each year we have to transfer the money into his main savings account and open another regular saver.

We where looking into bonds with the halifax, but you cant open one unless you make an appointment.

Im now thinking that the virgin money young saver which pays 3% might be a better option as we can put all his money into one account and then add to it each month.

xylophone

Be careful of £100 rule if the money is coming from parents.
http://bank.virginmoney.com/savings/learn/childrens-accounts/

ice_babe

xylophone wrote: »

Be careful of £100 rule if the money is coming from parents.
http://bank.virginmoney.com/savings/learn/childrens-accounts/

Don't really understand this? Is this if the money makes more than £100 in interest?
Using there calculator his money will make £96 interest per year, But obviously will be more in the future as we are paying into his account each month.

opinions4u

Just looked into his halifax savings account and the bulk of his money hes only getting 1.05% gross

Starting point is to get it in to their Young Saver account paying 2%.

ice_babe

Would we have to pay tax on the interest over £100 if im not a tax payer and the account was in mine and my sons name?

Sorry, find this all confusing

hugo15

I switched my daughter's account to Virgin Young Saver yesterday. The advisor said there was talk they might reduce the rate on new accounts soon, so act fast if you want to go down this route.

trulys

I also opened the Virgin Young Saver recently for my two sons after doing a fair bit of research. Theirs was inheritance money to invest so the £100 rule won't apply to their interest earned.

If you were to stick their money into their CTF, the £100 rule doesn't apply - Furness Building Society are offering 3.05% at the moment, and you can transfer your existing CTF into it, so that's quite good, and I've just transferred my son's to them. Once its in a CTF, it can't go anywhere else though so you have to be sure you want to tie it to a CTF!

HMRC website says the following:-

Q. Can someone who does not have sufficient income to be taxable, claim back tax deducted on interest paid?
A. Yes, if their total income is below the limit for paying tax, then they would be able to claim back the tax deducted.
6. Q. What happens if the tax is deducted at 20%, but I am only within the 10% band? Can I reclaim the tax back?
A. You can claim the difference back between the tax taken off at 20% and what you should have paid.

jimjames

ice_babe wrote: »

Would we have to pay tax on the interest over £100 if im not a tax payer and the account was in mine and my sons name?

Sorry, find this all confusing

If you're not a taxpayer then no there should be no interest to pay.

MayQueen

The Halifax will pay 6% for a child's tax ISA if the parent also has an ISA with them. That's a very good rate!