HMRC has issued an alert over unclaimed cash, encouraging people to claim their Child Trust Funds (CTFs). Thousands of 21-year-olds are affected as an estimated £1.6 billion lies unclaimed in these accounts.
What Are Child Trust Funds?
CTFs were introduced by the Labour government in 2005 for children born in Britain between September 1, 2002, and January 2, 2011. Under the scheme, parents and guardians received £250 vouchers from the government to open a fund. Children from poorer households or in local council care received double that amount. The money could be placed in a tax-free cash savings account or an account investing in shares or funds.
If the voucher was not used within a year, HMRC would open an account for the child. Stakeholder CTFs spread the money across different investments, with an annual fee not exceeding 1.5%. Parents and guardians could contribute up to £9,000 per year. When the child turned 18, they could access the pot.
Unclaimed Accounts
However, many CTFs remain unclaimed. According to figures analysed by the Share Foundation, 61% of accounts allocated by HMRC are unclaimed. The BBC reported on May 4 that Morning Live star Laura Pomfret discussed the issue, highlighting that an average of £2,200 is sitting in these forgotten accounts.
The BBC added: "If you or someone you know was born between 2002 and 2011, it's worth checking whether an account exists using the government's Child Trust Fund tool. Hundreds of thousands remain unclaimed."
To find out if you have an account, you can ask your parent or guardian, or contact HMRC to locate the provider. They can tell you where the account was originally opened.
