Property funds in child accounts

gettingtheresometime

Isn't there also an income tax issue? Presumably the interest on the money in the daughter's account is paid gross where as the OP would be liable to pay tax on the interest received 

SpiderLegs

wilfred30 said:

SpiderLegs said:

I’m fairly certain that when you do get that mortgage though you won’t be moaning about super low interest rates.

According to their opening post, the OP is a cash buyer.  It was just me suggesting that they might need to get a mortgage now instead due to them no longer having the cash!!

Oh I missed that. That actually means I now have zero sympathy for the OPs predicament.

greatcrested

gettingtheresometime said:

Isn't there also an income tax issue? Presumably the interest on the money in the daughter's account is paid gross where as the OP would be liable to pay tax on the interest received 

Post number 3!

My guess is that you have arranged it this way as a tax evasion measure (which of course is illegal).

grumiofoundation

gettingtheresometime said:

Isn't there also an income tax issue? Presumably the interest on the money in the daughter's account is paid gross where as the OP would be liable to pay tax on the interest received 

If all (or some) of the money is in premium bonds (I think was mentioned) since the prizes are tax free don't think these would count towards the £100 limit (after which OP is liable for tax).

gettingtheresometime

greatcrested said:

gettingtheresometime said:

Isn't there also an income tax issue? Presumably the interest on the money in the daughter's account is paid gross where as the OP would be liable to pay tax on the interest received 

Post number 3!

My guess is that you have arranged it this way as a tax evasion measure (which of course is illegal).

Lol I've now joined the dots!

greatcrested

gettingtheresometime said:

greatcrested said:

gettingtheresometime said:

Isn't there also an income tax issue? Presumably the interest on the money in the daughter's account is paid gross where as the OP would be liable to pay tax on the interest received 

Post number 3!

My guess is that you have arranged it this way as a tax evasion measure (which of course is illegal).

Lol I've now joined the dots!

That's more than the OP has done!

AnotherJoe

SuperCommuter said:

Hello! I'm a cash buyer looking to buy my first home this summer or autumn. The cash is from 10 years of employment savings. A decent amount of that money is held in accounts in my baby daughter's name where i am the sole named adult of the account and have instant access (so not Junior ISAs).  

What i'm not certain about is if this will cause an issue when determining proceedability by EAs and, more importantly, proof of funds when i approach a solicitor? I have 2 child bank accounts and premium bonds in her name. The statements are addressed to me as the sole responsible adult with her name listed as the child. There is no independent online banking login for her accounts: they are listed alongside my adult accounts when I login to online banking and NS&I. In all practical senses I am the only person with access to these accounts. 

Is this acceptable as proof of my funds given I have instant access to the accounts and the money came from other accounts of mine? I really don't want to move all this money to accounts in my name and then sit on it for 6 months. I earn around £80 on average per month from her accounts (NS&I prize dependant), so this will mean forgoing a sizeable amount as I've exhausted all my short term cash saving options.

This is fraud. Nothing more nothing less.

Forget about moving for 6 months, No solicitor is going to find using your childs money to buy a house for you acceptable.

Carl2510

Really doesn’t make sense to me that you’d open a child account for your own savings without having some sort of reason other than to gain more interest. And you can’t use the excuse your buying a house that will benefit her, no child will care where they live as long as they are fed and loved.

thats like me using my kids account to save money and gain interest to then take it out to buy a Golf Simulator because I think there going to be a golf pro when we all know I’ll be using it more!

jimbog

https://www.thisismoney.co.uk/money/experts/article-4025172/Can-save-money-child-s-saving-account-better-rate.html

noitsnotme

jimbog said:

https://www.thisismoney.co.uk/money/experts/article-4025172/Can-save-money-child-s-saving-account-better-rate.html

That article, whilst hinting it might not be ethically right, seems to almost encourage what the OP has done.  Even the quotes by the HMRC person only seem concerned about the parents paying any tax that might be due on the interest earned.  And that could be mitigated by the personal savings interest allowance, depending on the OPs situation.

From the article...

”Many may be adopting the tactic of opening accounts for children with traditional rates crashing and also lucrative high interest current account savings deals disappearing, including Santander 123 now offering 1.5 per cent rather than 3 per cent.

This Nationwide smart limited access account can be opened by anybody under the age of 17 by a parent as a trustee.

There is nothing illegal about the practice. However, there is a moral argument.”

Are they wrong?