Posted 23rd April 2020
HMRC has confirmed that maturing Child Trust Funds (CTF) will retain tax-free status from 6 April 2020. Although these new rules applied from 6 April the first CTF accounts will not mature until September 2020.
The CTF provider can then, with instructions from the account holder, transfer the investment at maturity to a tax-advantaged ‘matured account’. The ‘matured account’ can continue to be a CTF, or, an ISA (cash or stocks and shares) offered by the original CTF provider.
The amount of cash moved from the CTF to an ISA will not count towards the individuals annual ISA subscription limit for that tax year.