Consultation outcome

‘Lifestyling’ of Child Trust Funds

This consultation has concluded

Download the full outcome

‘Lifestyling’ of Child Trust Funds - summary of responses

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Detail of outcome

This summary of responses document will be of interest to Child Trust Fund (CTF) providers, as well as children who hold a stakeholder CTF account and their parents.

The document summarises the responses to HM Revenue and Customs’ consultation on lifestyling of CTFs, which took place between 21 September and 14 December 2015. It also outlines the decisions the government has taken and the proposed next steps.

Having carefully considered the responses to this consultation, the government intends to remove the legislative requirement that stakeholder CTFs must be subject to the process of lifestyling. It considers that developments in the market for tax-advantaged savings for children, including the increased choice available to account holders, mean that this requirement is no longer necessary to ensure children and families have access to suitable tax-advantaged savings products that meet their needs.

Legislation to amend the Child Trust Funds Regulations will be introduced to Parliament later this year.

Original consultation

Summary

This consultation seeks views and evidence on the costs and benefits of lifestyling for Child Trust Fund account holders and providers.

This consultation ran from
to

Consultation description

The consultation also seeks views on the potential consequences of removing the legislative requirement that stakeholder Child Trust Fund (CTF) accounts should be subject to lifestyling.

‘Lifestyling’ is the process by which an account provider adopts an investment strategy that aims to minimise variation in the capital value of a CTF caused by market conditions, as the account nears maturity.

It must commence for all stakeholder CTF accounts on or before the account holder’s 15th birthday, unless the registered contact for the account (usually the account holder’s parent) has instructed otherwise.

In 2013, HM Treasury consulted on whether it should be possible to transfer CTF savings to a Junior ISA. In the course of that consultation, a number of respondents questioned the value of lifestyling for many CTF holders. On 22 July 2014, the Government announced that it would consult on the lifestyling requirements for stakeholder CTF accounts.

Documents

‘Lifestyling’ of Child Trust Funds - Consultation document

This file may not be suitable for users of assistive technology. Request an accessible format.

If you use assistive technology (such as a screen reader) and need a version of this document in a more accessible format, please email different.format@hmrc.gsi.gov.uk. Please tell us what format you need. It will help us if you say what assistive technology you use.

Published 21 September 2015
Last updated 9 August 2016 + show all updates
  1. Published summary of responses
  2. First published.