Check Why HMRC Is Contacting UK Households with Children Born in 2009–2010: What Does It Mean?

Check Why HMRC Is Contacting UK Households with Children Born in 2009–2010: In recent weeks, many UK households with children born in 2009 and 2010 have been receiving letters from HM Revenue and Customs (HMRC) about Child Trust Funds (CTFs). You might be wondering what these letters are about, why HMRC is contacting households now, and what steps you need to take to claim any unclaimed funds. If so, you’re in the right place. This article will explain everything you need to know about the government’s Child Trust Fund initiative, why it matters, and how to ensure you can access any unclaimed funds.

HMRC Is Contacting UK Households with Children Born in 2009–2010

To sum up, HMRC’s initiative to contact UK households with children born between 2009 and 2010 about unclaimed Child Trust Funds is designed to ensure that young people don’t miss out on valuable savings. The funds could be a great help as they transition into adulthood. Whether you’ve received a letter from HMRC or simply want to make sure your child’s CTF is claimed, now is the time to act.

For more information, visit the official GOV.UK Child Trust Fund page. By checking and claiming the funds, you can give young adults a head start on their financial future.

What is a Child Trust Fund?

A Child Trust Fund (CTF) is a long-term savings account that was established by the UK government for every child born between September 1, 2002, and January 2, 2011. The scheme was designed to encourage families to save for their children’s future by providing them with an initial government contribution.

The government initially contributed £250 to each child’s account, with an additional £250 when the child turned seven. In certain circumstances, this amount was raised to £500 for children from lower-income families. Families could then make further contributions to the account up until the child turned 18. These accounts were meant to grow over time through interest and investment returns, providing a financial asset for children when they reach adulthood.

Why is HMRC Contacting Households Now?

As of 2024, children born in 2009 and 2010 are now reaching 18 years old, the legal age when they can access their Child Trust Fund. While many are excited to use the funds to help pay for education, starting a business, or buying a car, a significant number of young people have not yet claimed the money that has been sitting in these accounts for years.

In fact, over 670,000 young people are still unaware of their Child Trust Funds, according to recent reports. This is why HMRC has taken the step to proactively reach out to families who might have a CTF. By sending official letters, HMRC is encouraging parents and guardians to check whether their child has a CTF that could provide valuable financial support.

Why Haven’t People Claimed Their Child Trust Funds?

There are several reasons why many families may not have claimed their Child Trust Funds:

1. Lack of Awareness: Many people are unaware that their child has a CTF, especially if they didn’t open an account themselves. The accounts were often set up automatically by HMRC or financial providers, meaning parents may not have received any direct communication about the CTF.
2. Changed Contact Details: Families who moved houses or changed contact details may not have received the necessary letters informing them about the CTF.
3. Neglected Accounts: Since the CTFs are intended as long-term savings, many families may not have thought about them in recent years, assuming the funds were still locked away.
4. Forgotten Information: In some cases, individuals may have forgotten about the CTF altogether, especially if they did not receive consistent reminders or follow-up communication.

How Much Money Is in a Child Trust Fund?

The average balance in a Child Trust Fund is approximately £2,212, but this amount can vary depending on the type of investment and whether additional contributions were made by parents. Some accounts may have grown to a much higher amount, especially if the funds were invested in stocks and shares, while others may have smaller balances if there were fewer or no additional contributions made after the initial deposit.

For many young people, this sum can represent a significant financial foundation as they embark on adulthood. It’s especially important to encourage young adults to check for their CTFs before they miss out on this opportunity.

How Can You Access a Child Trust Fund?

If you believe that your child (or you, if you are the account holder) may have a Child Trust Fund, here’s how to find out and claim the funds:

1. Locate the Account Provider: Use the free tool provided on the GOV.UK website to locate the CTF provider. You’ll need the child’s National Insurance number and date of birth to search for the account.
2. Contact the Provider: After finding the CTF provider, contact them directly to inquire about accessing or managing the funds. Most providers allow you to check the balance online or via telephone.
3. Be Aware of Scams: Some third-party companies may charge fees to help you locate a Child Trust Fund. These services are unnecessary, as the government offers this information for free. Be cautious when dealing with third-party services to avoid scams.

Who Can Access the Funds?

The individual whose name is on the Child Trust Fund (the child) can take control of the account when they turn 16. However, they can only access the funds when they reach 18. At that point, the money becomes available to them for use.

Parents and guardians do not have control over the account once the child reaches 16, though they can guide the child on how to manage and use the funds.

What If You Can’t Find the Account?

If you’ve tried the steps above but still can’t find the Child Trust Fund, don’t worry. Here’s what to do next:

• Check Any Old Paperwork: Review any letters, emails, or documents related to the CTF that might have been sent when the account was initially set up. This could provide clues about the account provider.
• Contact HMRC: If you can’t find the account, HMRC can assist in tracking it down. Visit the GOV.UK website to get in touch with them and start the tracing process.

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FAQs about Contacting UK Households with Children Born in 2009–2010

1. How much money is in a typical Child Trust Fund?
The average balance is about £2,212, though it can vary depending on the type of investment and additional contributions made.

2. Can a parent access the CTF before their child turns 18?
No, only the account holder (the child) can access the funds once they turn 18. However, they can take control of the account at 16.

3. How do I find out who manages my child’s CTF?
You can use the free tool on GOV.UK to locate the account provider. You will need the child’s National Insurance number and date of birth.

4. Are there any fees for accessing the CTF?
There should be no fees for accessing the CTF, but some providers may have terms and conditions for managing the account. Always check the terms with your provider directly.

5. Can my child still access the CTF if they don’t know where it is?
Yes, if the account can’t be found using the provided tool, HMRC can assist in tracking it down. Make sure to start this process before your child’s 18th birthday.

6. What happens if the funds are not claimed?
If the funds remain unclaimed after the child turns 18, the money will stay in the account until the individual claims it. There are no penalties for leaving the money in the account, but it’s important to claim the funds to make use of them.