HMRC has confirmed that 21-year-olds born between 2002 and 2011 may be entitled to an average windfall of £2,200 from unclaimed Child Trust Funds (CTFs). The tax authority is sending letters to approximately 750,000 individuals, reminding them of forgotten savings accounts that collectively hold over £1.6 billion.
Background of Child Trust Funds
Between 2002 and 2011, the UK government provided tax-free savings accounts for most children born in the country, with initial deposits of hundreds of pounds. Parents and guardians could also add additional funds. The money becomes accessible when the child turns 18, intended to provide a financial boost for young adults.
However, an estimated 750,000 CTFs remain unclaimed, with the average balance being £2,200. HMRC posted on X: "There’s a Child Trust Fund in your boot! If you were born between 2002 and 2011, you could have up to £2,200 in a Child Trust Fund. Check if you have one today." The post included an image of Woody from Toy Story 5.
Martin Lewis's Advice
Martin Lewis, the BBC and ITV financial expert, highlighted the issue on his show: "The first thing I want to talk to you about is Child Trust Funds. There are some who are missing out on £1,000s. HMRC is currently writing to 21 year olds, only 21 year olds – about 750,000 of them – about unclaimed Child Trust Funds. These were the predecessor to junior ISAs and the state put money in for you."
He added: "You could add on top, people could add on top. But so everyone who has one has some money in it if they haven't taken it out. The letter will tell you where your Child Trust Fund is. So then you can go and contact that provider. Just be careful of scams. Don't use details on there. Go and find the provider's details yourself and be careful of emails, calls and texts. This is a letter."
Average Amounts and Variations
Lewis noted the average amount is £2,000, but it varies vastly depending on additional contributions by parents and whether the funds were saved or invested. "Invested over a long period outperforms savings. It's the whole point of this show," he said. He also clarified that those born between 1 September 2002 and 2 January 2011 who haven't accessed their CTF do not need to wait to claim it.
How to Claim
Recipients of the HMRC letter should verify the provider details independently to avoid scams. They can then contact the provider directly to access their funds. The letters are being sent to 21-year-olds specifically, targeting those whose CTFs matured but remain unclaimed.
