Thousands of parents to get easier access to £2,500 Child Trust Fund savings

THOUSANDS of parents are set to get easier access to cash for their kids with a change to rules.

Up to £1,000 of free cash was dished out to a generation of children and put in a special savings account for them by the government.

Child Trust Funds were given to every child born between September 1, 2002, and January 2, 2011.

Parents can add to this cash over the years and the average amount in a CTF is £1,500.

The cash is tied up until the child turns 18 and the first cohort gained access for the first time from September 2 last year.

But thousands of children who are disabled have been left unable to access the cash because of complicated rules.

Parents have had to go to court to get permission to make withdrawals on their child's behalf, taking pages of paperwork and costing hundreds of pounds.

Lib Dem MP Ed Davey has called for changes to the bureaucratic laws preventing access.

Writing for The Sun last year, he said: "Other children are enjoying their own savings, why should disabled children once again miss out?"

Now the government has unveiled plans for new rules to make it easier to get the cash.

Parents of children who do not have the mental capacity to manage their own money will no longer have to get permission from a court to access up to £2,500 every six months.

The person applying to withdraw the cash would have to prove they are a "suitable person" such as family member or guardian.

It would also apply to Junior ISAs and other cash accounts and it will be up to banks to manage the scheme.

Secretary of state for justice Dominic Raab said: "I’m determined to reduce the obstacles families and guardians face when they are supporting vulnerable people who lack mental capacity.

"These plans will make it easier and less stressful to access small funds while maintaining vital safeguards to prevent abuse and fraud."

The government is consulting on the plans, which could still be subject to change.

Previously the government has also looked at waiving court fees for those trying to access CTF cash.

Dan Scorer, of the charity Mencap said it is "welcome action" to improve access for smaller amounts while safeguarding children.

He said: "Over the last year families of young people with a learning disability have highlighted the significant barriers and cost faced in accessing Child Trust Fund money for their loved ones.

"The complexity of the legal system is a recognised barrier and the aim of a simpler and quicker process, which still has appropriate safeguards, is welcome."

When a CTF matures when a child turns 18, they can withdraw all or some of the cash, transfer it to another account or leave it where it is.

What is a Child Trust Fund and does my child have one?

Child Trust Funds were a government initiative for children born between September 1, 2002 and January 2, 2011.

Under the scheme, parents and guardians received a voucher to deposit into a CTF account on behalf of their child when the account was set up.

Vouchers were worth between £50 and £1,000 depending on when the child was born, as well as whether parents were on a low income at the time.

CTFS were replaced by Junior ISAs in November 2011, so you can't get one now.

Over 100,000 teens could have the pot of free cash and not realise worth £171millon.

Most people can fill in this online form via the Gov.uk website to check if there's a CTF account.

You will need a Government Gateway user ID and password and you can create one if you don't have one already.

Parents looking for a child’s account need their Unique Reference Number from an annual CTF statement or their National Insurance number.

If you’re looking for your own trust fund, you’ll just need your National Insurance number.

This is normally sent automatically in the three months before a person's 16th birthday, but you can track it down via Gov.uk if you've lost it.

Once the form is complete, HMRC will send you details of the CTF provider by post within three weeks.

 

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