What is the Child Trust Fund?

The Child Trust Fund is a long-term savings and investment account made available to qualifying children born on or after September 1st 2002.

Once you have registered and have been awarded Child Benefit, the Inland Revenue will send you a £250 voucher (families receiving Child Tax Credit with income at or below £15,575 for 2008/2009, will receive an additional £250 paid directly into their child's Child Trust Fund). The Inland Revenue will make a further payment of £250 around your child's seventh birthday (£500 for low income families).

With no restrictions as to who can top-up your child's Child Trust Fund, and maximum payments allowed totalling £1,200 each year, the Child Trust Fund is a great way to start your child's tax-free savings.

Is my child eligible for a Child Trust Fund?

If you have registered and have been awarded Child Benefit for your child, they were born on or after September 1st 2002, are living in the UK, and they are not subject to immigration restrictions, your child will be eligible.

If your child is elibigle, the Inland Revenue will send the Child Trust Fund voucher to the person who claims Child Benefit.

When you receive the Child Trust Fund voucher, you will need to decide who will open and be responsible for the Child Trust Fund. This has to be someone over 16 with parental responsibility.

You will then need to decide the type of Child Trust Fund account you want to open, and with which Child Trust Fund provider. Visit the Child Trust Fund for a rundown of the types of Child Trust Funds available and all the latest offers and incentives.

Note: The voucher will expire after 12 months!

If you fail to open a Child Trust Fund before the voucher expires, the Inland Revenue will open a Stakeholder Child Trust Fund for your child. So act quickly giving your child's money more time to grow!

How much will my child expect to receive?

Eligible children will receive a voucher for £250. However, if your child was born between 1st September 2002 and 5th April 2005, they will receive an adjusted value slightly more than £250 as the Child Trust Fund has only been available since April 2005.

If your child is part of a household receiving Child Tax Credit and the household income is at or below the Child Tax Credit income limit (currently £15,575 for 2008/09) when Child Benefit is first awarded, your child will receive an extra £250. The Inland Revenue will make the payment automatically once you have finalised your Child Tax Credit claim for that year so you will not need to make an additional claim.

Where can I open a Child Trust Fund account?

There are many different organisations offering Child Trust Fund account.

What types of Child Trust Fund can I open?

All Child Trust Fund providers must at least offer access to a Stakeholder Child Trust Fund. At their descretion they may also provide Non Stakeholder Savings Child Trust Funds and Non Stakeholder Equity Child Trust Funds.

I would like to find out more?

Please visit the Child Trust Fund for details of the latest offers and incentives from all the Child Trust Fund providers.

Source: "Child Trust Fund factsheet" on the website at www.childtrustfund.gov.uk