Childrens Accounts - Is there a maximum?

princessdon

Evening all

My children have now passed the £200 interest in their accounts from money funded by parents, so it needs to be declared and is being done so.

So is there anything stopping me using their accounts as my savings accounts now?

Ie I can't get 3% (outside of ISA's) for easy access so is there anything preventing me legally from using their accounts to save money in. I am aware I will have to declare for tax, but am doing this anyway as it went over the £200, so apart from this can I use their accounts.

Annisele

You can put money into their accounts - but you can't then withdraw it to use for yourself.

xylophone

Money placed in your child's account is an absolute gift to your child.

princessdon

Hmm not as simple as I thought. The reason I ask is that it is for the children but not an absolute gift.

I am looking to buy at BTL for the children, I am saving for this and when I need to purchase would need to remove the deposit from the accounts. They get a better rate of interest than I get bar my ISA and don't want to remove money from the ISA as it took a number of years to build up and as 40% rate payers it means tax.

I just thought I could add to their bank accounts and then use as my BTL savings, but it would be withdrawn in the next few years, so I take it this is frowned on?

Annisele

princessdon wrote: »

I just thought I could add to their bank accounts and then use as my BTL savings

You've put your finger on the problem. If you add the money to their savings, the money belongs to your children - and you can't then count that money as your savings.

If you want to make an absolute gift to your children, then putting the money into their accounts is fine. If you don't, it's not.

The actual risk of anyone noticing is probably fairly small (assuming you don't have a fight with your children in a few years). However, it would look as though you were stealing from your children - generally not a good plan!

princessdon

Annisele wrote: »

You've put your finger on the problem. If you add the money to their savings, the money belongs to your children - and you can't then count that money as your savings.

If you want to make an absolute gift to your children, then putting the money into their accounts is fine. If you don't, it's not.

The actual risk of anyone noticing is probably fairly small (assuming you don't have a fight with your children in a few years). However, it would look as though you were stealing from your children - generally not a good plan!

yeah I just thought that as I was paying tax on them anyway, and it was for them it would be easy to do. Children are too young to even know they exist so no fights, but assumed there would be a reason why you can't do this so best to check before placing the deposits etc.