Thousands of students across the UK have been collecting their A-level results this week. But few might know that, regardless of their grades, they could have thousands of pounds lying in wait for them in a forgotten account.
HMRC's call to action
HMRC is urging 18-year-olds to check if they have a Child Trust Fund they can claim, sharing on X: “If you’re turning 18 and finishing school, you might want to read this.” These accounts were set up for each child born between September 1, 2002 and January 2, 2011, including children in care.
The Government deposited an initial £250 while parents could add up to £9,000 each year. Meaning that children whose parents maxed out their contributions each year until they turned 18 could have over £160,000 in the tax-free account.
Unclaimed billions
On average, these accounts hold around £2,200 each according to Government figures. Child Trust Fund accounts can only be controlled by the child it was originally set up for once they turn 16, and they can only withdraw the money when they turn 18.
HMRC notes: “Until your child withdraws or transfers the money, it stays in an account that no one else has access to.” Around £1.6billion is estimated to be in Child Trust Funds that are yet to be claimed by around 750,000 savers.
Government task force
To help encourage more people to access their funds, the Government set up a task force with the help of numerous high street banks earlier this year. Members of the Taskforce include a number of Child Trust Fund providers, such as Nationwide, HSBC UK, Sheffield Mutual, Yorkshire Building Society, and more, to coordinate efforts to reunite young people with their savings and tackle the practical challenges that stop people from claiming.
The task force was formed shortly after the Government announced it would also be sending letters directly to eligible 21-year-olds with unclaimed accounts.
How to claim
The oldest people eligible for Child Trust Funds are nearly 24. While the youngest Child Trust Fund holders have turned 15 this year and still can’t manage their own accounts.
HMRC has a ‘Find your Child Trust Fund’ tool on its website to check if you or your child might have one of these accounts. The process to claim the cash is simple and can be done yourself without the need for a third party.
If you know the account details, you can go directly to the bank that holds the account to withdraw funds. It’s not liable for income tax, and many people opt to move this money into adult ISAs to keep the tax-free element.
However, if you don’t know the account details, you can request this information from HMRC. You can only do this if you are the account holder and at least 16 years old or if you’re the parent or guardian of an account holder who is under 18.
Children who were in care had their Child Trust Fund managed by the Share Foundation. The foundation will write to the child when they become old enough to take control of the account and will manage the account until the child takes it over or someone takes parental responsibility for them.
