Budget Notes

BN49 CHILD TRUST FUND: VOUCHER REQUIREMENT

Who is likely to be affected?

1. Child Trust Fund (CTF) providers, CTF distributors and parents/guardians who have received or will receive a CTF voucher.

General description of the measure

2. Regulations will be laid in due course to remove the requirement for providers and distributors to collect the CTF voucher from parents in order to open a CTF account.

Operative date

3. The new account opening rules will have effect on and after 6 April 2009.

Current law and proposed revisions

4. Under the current CTF Regulations (S.I. 2004/1450 as amended), the applicant (parent) must give the voucher relating to the named child to the account provider or distributor not later than 7 days after the expiry date on the voucher. This allows the provider or distributor to open a CTF account.

5. This measure will remove the need for the voucher to be collected by CTF providers and distributors as part of the account opening process.

6. Instead of the parent handing over the voucher, CTF providers and distributors will be able to open accounts using essential information from the CTF voucher provided by the customer, such as the unique reference number, the child's date of birth and the voucher expiry date. This change will allow, for example, telephone and internet applications for CTF accounts to be made in a single paperless transaction without the need for the customer to post the voucher separately.

7. This change will apply to all applications processed by providers or distributors from 6 April 2009.

8. The measure allows those CTF providers and distributors who wish to continue collecting the vouchers from parents to do so.

9. A public consultation paper was published on 24 October 2007 and a summary of the consultation responses has been published today.

Further advice

10. If you have any questions about this change, please contact Anna Caffyn on 020 7147 2855 (email: anna.caffyn@hmrc.gsi.gov.uk). Information about Budget measures is available on the HM Revenue & Customs website at www.hmrc.gov.uk