CTF

Started in 2005, for any child who was born before 1^st September 2002, provided that

• Child Benefit had been awarded for them by HMRC; 
• The child was living in the UK (the children of Crown servants posted abroad qualified because they are treated as being in the UK); and 
• The child was not subject to immigration controls. 

The government made lump sum payments at particular ages.

3 types of CTF accounts:

1. Savings Accounts – Bank saving accounts
2. Share Accounts – Basically a S&S ISA
3. Stakeholder CTFs – Low cost CTF, mainly invested in equities.

Tax benefits:

• All interest on fixed interest securities and on deposits are free of income tax. 
• There is no additional tax liability on UK dividends. 
• All capital gains are free of income tax. Any income or gains generated from parental gifts to the CTF are not taxable on the parents. 

No more government payments will be made but you can still contribute £4,080 to existing CTFs in this tax year. The subscription year usually runs to the child’s birthday and it matures on the child’s 18^thbirthday.

The government stopped issuing new CTF vouchers from 1 January 2011, introducing the JISA. CTFs can be transferred to JISAs

JISAs

• Introduced in 2011.
• All UK resident children who don’t have a CTF can have a JISA.
• Both Cash and S&S JISA are available and the child can hold one Cash and one S&S at any one time.
• All returns are tax free on the child and parent.
• The annual subscription limit is £4,260.
• Until the age of 16, a person who has parental responsibility will manage the JISA and after 16 the child will manage the account.
• Then at the age of 18 the JISA will become an ISA.
• Since 2015 it has been possible to transfer a CTF to a JISA.
• 16 & 17 year olds can hold both JISAs and Cash ISAs meaning they have an effective ISA allowance of £24,260 (20,000 + 4,260).
• There are no stakeholder versions of JISAs available.