Can I save my money in my daughter's name?

Gracie8475

Hi all

I am new here and am hoping I can get some advice please. I wasn't brave enough to ask the lady in the bank today as I don't want to get myself in trouble!

So, as we all know, the savings' rates are rubbish. However, my two daughters are both getting a lovely 3% on their easy access accounts.

My husband and I are sorely tempted to put our cash in their accounts but we don't know if this is technically legal or not. I guess there is an argument to say who would know but I don't really want to do anything I shouldn't! I know we could 'gift' it to them but we aren't doing that, it's our money and it is likely to be required at some point in time.

Any help/advice/opinions much appreciated.

Thank you!

innovate

You can put as much money as you like into your daughters' accounts, and all of it will be legally theirs.

But what 3% accounts do they have you cannot get yourself?

JoeCrystal

Then it is not fair on your kids. Should you put in in their names, then it is their legally and you are just a thief by stealing from them if you decide to take the money out for your use.

In other words, I feel strongly that it is bad idea.

Thanks,
Joe

innovate

Also, any interest earned in your daughters' accounts will be taxable income for them (unless you are talking cash ISAs but they'd be very limited in terms of how much can get paid in every year, and it's not likely you were talking ISAs, anyway).

If your daughters will remain basic rate tax payers after any interest due from any deposits you made, that might not cause any issues. But if they get pushed into the 40% tax bracket, will they be thankful to you for the extra tax they have to pay?

Also, would your savings push either of your daughters over the £85K FSCS limit anywhere?

(I have assumed all the way that your daughters are older than 17, btw. Other considerations will apply if they aren't)

typistretired

My advice is to not put your money in your daughters' accounts. You don't say which bank or account it is or how much is involved. Most easy access with good rates are coming to their end. Most savvy savers are now opening current accounts which offer either 3% or 5%. Do a search for Nationwide flexdirect, Lloydstsb Classic Vantage, BOS Classic Vantage, TSB also has one I think it is Classic Endurance or something similar on this forum to give you ideas.

ps Welcome to the Forum.

xylophone

Money put into your daughters' accounts becomes legally theirs.

Also note the £100 rule
£100 rule
There are special rules if a parent has given savings to their child. Where gifts from a parent produce more than £100 gross income a year, the whole of the income from the gifts is taxed as the parent’s income. A child cannot claim back any tax on that income. Nor can interest be paid without tax taken off.

The £100 rule applies to young people until they reach eighteen or marry (whichever comes first).
The £100 rule applies separately to each parent.

Gracie8475

Thank you all!

My two girls are 1 and 3, so just babies really, but tax doesn't come into it for them.

I didn't really think it was going to be a good idea and I certainly don't want to get into bother over it, it was just a thought as I figured who would notice but I guess these things have a way of biting you in the bottom!

Anyway, will have a search around at the suggestions given so thank you all.

Archi_Bald

Gracie8475 wrote: »

but tax doesn't come into it for them

errrm, yes it does. See xylophone's response. Any UK resident, regardless of age, is subject to tax.

ses6jwg

I thought about this as well as I have a Lloyds young saver paying 3% for my daughter. obviously I would need to de-register the gross interest registration if I did deposit a large amount.

blinko

innovate wrote: »

Also, any interest earned in your daughters' accounts will be taxable income for them (unless you are talking cash ISAs but they'd be very limited in terms of how much can get paid in every year, and it's not likely you were talking ISAs, anyway).

If your daughters will remain basic rate tax payers after any interest due from any deposits you made, that might not cause any issues. But if they get pushed into the 40% tax bracket, will they be thankful to you for the extra tax they have to pay?

Also, would your savings push either of your daughters over the £85K FSCS limit anywhere?

(I have assumed all the way that your daughters are older than 17, btw. Other considerations will apply if they aren't)

ok and what about the tax implications?