If there’s one thing we can’t stand at RIFT Tax Refunds it’s money that should be in your pocket going unclaimed. That’s why we work so hard to claim back the tax refunds you’re owed each year. Now, what if we told you that there was a “forgotten” government scheme that was designed to put literally thousands of pounds in the hands of hundreds of millions of people? What if we said that 200,000 of these pay-outs have gone unclaimed to date, leaving an massive £400 million on the table? Sounds unbelievable, right? That’s exactly what’s happened with the Child Trust Fund (CTF) scheme that came in back in 2002.

How Do Child Trust Funds Work?

Here’s how the system worked. Children born between the 1st of September 2002 and the 2nd of January 2011 qualified for a CTF. It was like a long-term, tax-free savings account, which could be topped up by £9,000 a year. Parents or guardians were sent payment vouchers of £250 to start a CTF off (or £500 for low-income households), and then the same again when the child turned 7. There were:

  • Cash CTFs that earned tax-free interest.
  • Stakeholder CTFs that were invested in the stock market.
  • Shares-based CTFs which had a bit more freedom in where the money went, but had fewer protections.

If the parents didn’t make a choice (close to 2 million of them didn’t), HMRC did it for them. Once the child turned 16, the rules allowed the money to be moved around. Once they hit 18, though, they could access it freely. That’s what’s happening now – but it’s also where so many people are missing out.

What Is A Child Trust Fund Worth?

With people with CTFs now starting to turn 18, it looks like a lot of the accounts have been forgotten altogether. That’s an average of £2,000 going to waste for each of the 200,000 18-year-olds with unclaimed matured accounts so far – an astonishing £400 million overall!

Obviously, the amounts sitting waiting for people to claim them vary case-by-case, since the rules for topping up the accounts were pretty generous. Also, the scheme was tied to the stock market in many cases, so the actual amount in a mature CTF depends on the kind of investments made with the money. Right now, though, it’s looking like £2,000 is a decent average – and it’s going to waste until it’s claimed.

Looking ahead, HMRC says that up to 1.8 million CTF accounts have probably been completely forgotten overall. As the years go by, more and more of these will mature as their owners turn 18 – meaning many more standing to lose out.

How Can I Check If The Governement Set Up A Child Trust Fund For My Child?

So, how do you retrieve a forgotten CTF account? It’s actually pretty simple. There’s a form on the Government Gateway website that’ll help you sort this out. You’ll need a Gateway login and password, of course, plus the owner’s National Insurance and Unique Reference numbers if you’re the parent or guardian. You can also apply by post instead. Either way, you should be able to get the details of the lost account from HMRC inside 3 weeks.

There’s never a good reason to leave your own cash in the taxman’s pockets. That’s as true for Child Trust Funds as it is for tax refunds. Every year, British workers lose thousands of pounds to HMRC that should be back in their own wallets. Don’t be one of them. Check if you're due a Tax Refund - it only takes a few seconds and we'll help you get back what’s yours.

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