Children's accounts and your savings question?

tincat

This is more a theoretical question now although it would apply to me if my situation changes.

If your children have savings accounts, which other family members pay into and your own contributions have been minimal (can be proven), would the HB or tax credit people insist on adding their accounts to your savings allowance?

This would be money you would never have seen if your children didn't exist. One child has a NS&I account and the other has a child trust as born after 2002.

msmicawber

Hi tincat,

Yes, as far as HB is concerned that's your money. Provided your combined savings don't exceed the £6,000 limit, though, it shouldn't affect your benefit.

tincat

Is this the case even in the Child trust fund for the youngest child? I thought that most of the benefit of them was that once the money goes in, the child will only be able to access it when they're 18. I didn't know parents were allowed / supposed to raid them?

msmicawber

I don't know about Child Trust Funds specifically, I'm afraid, Tincat, but various of the posters on this board work for LA benefits sections, so someone should come along in a while who can answer that categorically.

tincat

Does anyone else have any idea about this?

Thanks

msmicawber

It looks as though none of the Benefits staff is on this evening. I found this article:

http://www.publications.parliament.uk/pa/cm200304/cmselect/cmtreasy/387/387.pdf

If you look at page 7, it appears that the savings limit for HB purposes was raised to £6,000 partly to allow for the Child Trust Fund. The statement about 'discretion' as to whether these savings can be viewed as deprivation of capital is a bit vague and worrying, however, if dribs and drabs of money have been added to a CTF by a variety of friends and relatives over a period of time, I can't see that anyone could be accused of purposely using it to deprive themselves of capital to receive benefits.

I hope that helps a bit, but also hope that someone who works in a benefits section can give you a clear picture of how it works in practice.