child trust fund question ? advice needed please.

[goldenbolls]

we currently put £80 per month into childs account with family investments, will she be taxed on her money when she reaches 18 years old ? if say she saves £1000 per year for 18 years £18,000 . or does she only pay tax after she has that money herself , bviosly she cannot withdraw it untill she,s 18.

we are just worried about the way things are going now with government cuts on pensions etc.

what would you do ? we were going to shorten her money to £50 per month but we do want her to get as much as possible when she is older .

maybe switch family investments into an ordinary savers acount with bank, ive heard that family investments is goverment run and they can gamble your money with shares etc but i just dont know , hence this question ;-)

[dasherman]

I'm no expert on child trust funds, but a quick look at the Family Investments website would suggest that your daughters money is invested in either the 'Stakeholder Child Trust Fund' or the 'Ethical Stakeholder Child Trust Fund', both of which invest in shares, which over a 18 year period should prove to be a better investment than cash.
Infact they are not dissimilar to a personal/stakeholder pension that you may have yourself.

Tax is not payable on child trust funds at any stage of their lifespan or when they mature.

[goldenbolls]

thats good thanks, we will start getting the max amount we can into them then. cheers

[factor-fiction]

But once she becomes a taxpayer and takes the proceeds she will have to pay any tax due on any interest from the proceeds

[goldenbolls]

so if she has £18,000 in her trust fund when she is 18 years old what exactly would the government take off her ? advice someone please, look at the government now robbing peoples pensions etc, im not going to let them take away or gamble my childs money, who knows the future ?