Premium Bonds - Using a child's allowance

Jones80
Jones80 Posts: 29 Forumite
Combo Breaker First Anniversary
in Savings & investments
Hi,

I have reached the maximum £50k in my premium bonds account and was wondering if it was legally ok to set up an account for a child and use that allowance too?

Not for anything dodgy and not for the child to be gifted that money as such, purely to be able to invest more of my money in that savings solution.

With interest rates so low I see literally no point having a savings account, so may as well gamble on raffle tickets each month until they rise.

Kind regards,
Jones80

Comments

  • xylophone
    xylophone Posts: 44,345 Forumite
    Name Dropper First Anniversary First Post
    not for the child to be gifted

    See below - buy for a child, you buy as a gift.

    https://www.nsandi.com/premium-bonds

    Premium Bonds can make a special gift for your child, grandchild or great-grandchild.

    Until the child’s 16th birthday the parent or guardian nominated on the application looks after the Bonds, regardless of who buys them.

    We’ll send confirmation of any transactions made, prizes won and payment for cashed in Bonds to the nominated parent or guardian until the child is 16.

    Buying for your grandchild
    Grandparents and great-grandparents can apply online or by post. You can ask us to send you an electronic or paper gift card for you to pass on to the child. We’ll also send you an acknowledgement of your investment. But only the nominated parent or guardian will be able to manage and cash in the Bonds. Before you apply, please make sure they are happy to look after the investment for the child, and agree to you giving us their details. We will check the identity and address of everyone named on your application, and we may need to ask for documents to prove this. Please let the parent know that we might be in touch with them to do this.

    Buying for your child
    Parents or legal guardians can apply online, by phone or by post. If your child already has some Premium Bonds and you want to buy some more online or by phone, you’ll need to be registered first. This could take a few days while we set up your registration.
  • IanManc
    IanManc Posts: 2,080 Forumite
    First Anniversary First Post Combo Breaker Name Dropper
    Jones80 wrote: »
    Hi,

    I have reached the maximum £50k in my premium bonds account and was wondering if it was legally ok to set up an account for a child and use that allowance too?

    Not for anything dodgy and not for the child to be gifted that money as such, purely to be able to invest more of my money in that savings solution.

    With interest rates so low I see literally no point having a savings account, so may as well gamble on raffle tickets each month until they rise.

    Kind regards,
    Jones80

    You would be signing a form saying that you were investing on behalf of the child, when in reality you would be investing on your own behalf.

    So it would be a "not for anything dodgy" fraudulent application then? :)
  • AnotherJoe
    AnotherJoe Posts: 19,622 Forumite
    First Anniversary Name Dropper First Post Photogenic
    Jones80 wrote: »
    Not for anything dodgy and not for the child to be gifted that money as such, purely to be able to invest more of my money in that savings solution.

    how is that not more than dodgy but outright fraud?
  • Jones80
    Jones80 Posts: 29 Forumite
    Combo Breaker First Anniversary
    Thanks for the replies.

    If there is a form that says it's on behalf of a child then it does borderline on dodgy, yeah I agree.

    It's probably not clear cut though and I suspect its a grey area. It's only the same as doing something like using your wife's tax allowance when you own a company etc.
  • xylophone
    xylophone Posts: 44,345 Forumite
    Name Dropper First Anniversary First Post
    It's probably not clear cut though and I suspect its a grey area.

    You did read the information from NS&I in my post above?
  • IanManc
    IanManc Posts: 2,080 Forumite
    First Anniversary First Post Combo Breaker Name Dropper
    Jones80 wrote: »
    Thanks for the replies.

    If there is a form that says it's on behalf of a child then it does borderline on dodgy, yeah I agree.

    It's probably not clear cut though and I suspect its a grey area. It's only the same as doing something like using your wife's tax allowance when you own a company etc.

    It is dodgy, it is clear cut, it isn't a grey area and it is fraud. :)
  • steampowered
    steampowered Posts: 6,176 Forumite
    First Anniversary Name Dropper First Post
    Jones80 wrote: »
    With interest rates so low I see literally no point having a savings account, so may as well gamble on raffle tickets each month until they rise.

    Why do you not invest the money - for example, through a stocks & shares ISA.

    This is by far the most sensible thing to do if you are saving for the long term.
  • Ergates
    Ergates Posts: 2,108 Forumite
    First Anniversary First Post Name Dropper
    Jones80 wrote: »
    Thanks for the replies.

    If there is a form that says it's on behalf of a child then it does borderline on dodgy, yeah I agree.

    It's probably not clear cut though and I suspect its a grey area. It's only the same as doing something like using your wife's tax allowance when you own a company etc.

    It's outright tax fraud. HMRC aren't stupid, they look out for parents opening accounts in their children's names to avoid taxation.

    But sure, go ahead if the you're willing to risk 6 months in prison for tax evasion.
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