17 year oil’s savings account

YouCountthePennies

I set up a child’s account in their name with Halifax. When she turned 16 it was moved to regular savings account. Will it be taxed? I can still see it on my online backing, as I can see their younger sibling’s child account. Halifax should know her age. I’d hate for her to lose money if I could have avoided it.

Dazed_and_C0nfused

https://forums.moneysavingexpert.com/discussion/6662775/17-year-oil-s-savings-account

There is no tax on savings in the UK.

If you mean the interest then what income does she have which uses up all of her Personal Allowance (of £12,570)?

Albermarle

Does the 17 year old have any other income?

Keep_pedalling

If all the money came from the parents then any tax liability falls on them not the child.

https://www.gov.uk/savings-for-children

poseidon1

https://forums.moneysavingexpert.com/discussion/comment/81950896#Comment_81950896

Its a little surprising how few parents ( unless they have an accountant) are aware that income in excess of £100 on savings accounts they fund for their children is taxable and reportable on the parent.

The requirement is nothing new and been codified back in 2005 when the parental settlement anti avoidance tax rules were introduced to attack a whole host of arrangements where a parent might 'use' a child to avoid higher rates of income tax on their own income - the following manual provides more detailed coverage of the rules

https://www.gov.uk/hmrc-internal-manuals/trusts-settlements-and-estates-manual/tsem4300

Dazed_and_C0nfused

https://forums.moneysavingexpert.com/discussion/comment/81950896#Comment_81950896

True, but the op only mentioned setting up the account not funding it.

YouCountthePennies

Thank you all. The money was inheritance. Several years ago. Interest is under £100. No other income. I’m also worried that it’s still visible on my app so the back might think it’s mine. But I did set it up in their name originally.

xylophone

Why not move the money into a junior ISA?

YouCountthePennies

that’s the money was inheritance in their name.

YouCountthePennies

Sorry, that should read Thanks not that’s. They were quite young when I went into the back to set it up. I’m wondering if ruled change over 16 I guess that’s why I’m asking.

YouCountthePennies

I have been told that junior ISAs need to be opened for under 16s ands they are too old. Maybe that means they can get a regular ISA though?