Saving for children

LM1971

Does anyone know of a way I can send savings gifts for children, in a way that the parent can't access that money?
I looked at Premium Bonds, but I think the parent could cash them, as they have control.
Any advice much appreciated.

Ludoes2017

You can put money or assets into a trust for them, which would be protected by someone else. You set the conditions e.g. that cash or assets are released to the children when they reach a certain age.

LM1971

Thank you. I'll look into that. I don't know much about savings really.

foofi22

Junior ISA - you control it but the money is the child's. The child gets access at 18 when it "turn into" a standard adult ISA

Reaper

foofi22 wrote: »

Junior ISA - you control it but the money is the child's. The child gets access at 18 when it "turn into" a standard adult ISA

This is the best option BUT it is not correct to say they will have control. It must be opened by the parents and the parents can decide who to take it out with and where the money will be saved/invested. You will just be contributing.

On the plus side the parents are unable to withdraw any of the money and there is no tax to pay.

Alexland

I suggest you ask the parents if the child already has a Child Trust Fund or Junior ISA to which you can make contributions for them.

LM1971

Thank you all for your advice. The parent is untrustworthy where money is concerned, so it needs to be something where they have no involvement. It's probably not possible at all.

cloud_dog

LM1971 wrote: »

Thank you all for your advice. The parent is untrustworthy where money is concerned, so it needs to be something where they have no involvement. It's probably not possible at all.

You would be unable to do anything (outside of a JISA/CTF) without a birth certificate.

Best thing to do is to set aside money/investment in your own name (attributed in your head/on paper somewhere for the benefit of child X or children of Y) and then at age 18 gift them the money.

Reaper

LM1971 wrote: »

Thank you all for your advice. The parent is untrustworthy where money is concerned, so it needs to be something where they have no involvement. It's probably not possible at all.

It's possible. The main options are:
* If the child has an existing CTF or JISA get the details and pay into that.
* If not get the parents to set up a new JISA (you could fill the forms in for them to sign) and pay into it yourself.
The benefits are the money is free of all tax and the parents are unable to withdraw it (though they can say where it is to be saved/invested). The child takes over control at 16, and at 18 it turns into an adult ISA which they can keep or end as they see fit.

Another alternative is a "bare trust". Typically done with investments rather than savings it's usually free to set up. Not quite as tax friendly. It is taxed as the child's money, which normally means there is nothing to pay at least until they get a job.
You pick trustees who will control it. Probably yourselves. At age 18 the child gets the money.

Finally you can put it in an account under your own name, or one "designated" for the child. Either way this means the money is still yours so you pay any tax required on it. Then you gift it when you are ready. However you might want to mention it in your will so people know that is the intention.

xylophone

Once the money is in a CTF/JISA, it belongs to the child absolutely and the parent cannot withdraw it.

The parent may choose the cash JISA provider/the investments but only the child will be able to access the money at the age of 18.

The child may control the account from the age of 16.

https://www.gov.uk/child-trust-funds

https://www.gov.uk/junior-individual-savings-accounts

LM1971

Many thanks for all the advice. I'll look into these options.