Can a grandparent open up a bank account?

xxxpinkladyxxx

I have a 10 month old son and when I had him, my dad kept going on about giving him some money and opening up a bank account for him. I said no, we would be opening up a bank account for him and to just write my son a cheque. My dad has quite a bit of money that he's always wanting to "invest" to make himself as much money as possible and I'm pretty sure he has it in his head that he can open a tax free savings account in my son's name for his own use basically. There is no way I'm letting my dad use his grandson to make money. My dad is and always has been very tight and money-hungry. When I told him that we had opened a bank account for my son and that he could write me a cheque, it never came.

Now my son's birthday is coming up and he said to my mum that he wants to give him money so my mum said to write him a cheque and that me and my husband would put it into our son's bank account but my dad said that no, he was going to open up a bank account for my son himself to put the money in. Can he do this (I'm assuming not without my permission)?

hardpressed

I believe he can if he has a copy of his birth certificate.

castle96

Blimey. It's dad's money, he wants to maximise it as much as possible for your son,, and you 'object'. If it was me I would say 'Thanks Dad'. Especially in the current times you have to make every penny work for you (or someone else).

Can a g/parent open an ISA for a child - think so.

Have a look and advise your Dad of the best account to do the best for the lad...

castle96

(assuming it IS to be for your son's/eventual benefit)

xxxpinkladyxxx

castle96 wrote: »

Blimey. It's dad's money, he wants to maximise it as much as possible for your son,, and you 'object'. If it was me I would say 'Thanks Dad'. Especially in the current times you have to make every penny work for you (or someone else).

Can a g/parent open an ISA for a child - think so.

Have a look and advise your Dad of the best account to do the best for the lad...

Read my post again! He wants to use the bank account to maximise the money for himself. My son would never see the money!

Newbie2saving

A child can earn up to £9,440 tax free 2013-14, so I could see why it may appear attractive to him! I have always needed a birth certificate for my son, even his passport wouldn't do when I wanted a simple regular Halifax saver so you should be ok.

EarthBoy

I hope you need more than just a birth certificate because they are public documents and anybody can get hold of them. They cost £9.25 from the General Register Office, or more if you use a third party service.

If you can open an account for any child then anybody could open them for anyone. The bank/building society would have no way of proving whether you are or aren't the child's grandparent.

xylophone

Open a JISA for your son and tell Dad he can contribute to that! https://www.gov.uk/junior-individual-savings-accounts/overview
http://www.halifax.co.uk/isas/ 6% currently available if the parent has a cash isa with them.

With regard to the grandparent opening an account in trust for the grandchild, the money would belong beneficially to the child - the parent would have to sign the R85 and if the account remains in trust after the age of 16, reclaim any overpaid tax as the R85 would be rescinded. See here http://bank.virginmoney.com/savings/learn/childrens-accounts/

Read the R85 here http://www.hmrc.gov.uk/helpsheets/r85-helpsheet.pdf[url] http://bank.virginmoney.com/downloads/r85form.pdf[/url]

grey_gym_sock

he can't open a junior ISA without a parent doing something, but might (i don't know what documents he'd need) be able to open a simple nominee account, where the child is the beneficial owner and which he controls. there is no limit to how many nominee accounts can be set up (unlike junior ISAs).

if he did that, the interest would be the child's for tax purposes, so presumably untaxed given the personal allowance.

if he did that, and then took money out of the account and used it for his own benefit, not the child's, then he would be acting illegally, and in theory his grandchild could sue him. though this would be difficult if you don't know whether this account even exists.