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HMRC internal manual

Savings and Investment Manual

HM Revenue & Customs
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Interest: taxation of interest: children's accounts

Accounts held by unmarried minor children

Interest arising on an account held by an unmarried person under 18 is treated as income of his or her parent if

  • the money in the account was a gift from the parent, and
  • the interest exceeds £100.

The gift constitutes a settlement and ITTOIA05/S629 (1) applies to treat the interest as income of the settlor. There is more detailed guidance, with examples, at TSEM4310 (SAIM20000).