A BBC personal finance expert has revealed that HM Revenue and Customs (HMRC) is sending letters to thousands of young people, informing them of potential payouts averaging £2,200 from unclaimed Child Trust Funds. Appearing on BBC Morning Live, Laura Pomfret explained that over 750,000 accounts remain unclaimed, holding a combined total of £1.5 billion.
What Are Child Trust Funds?
Child Trust Funds (CTFs) are long-term, tax-free savings or investment accounts established for children born in the UK between 1 September 2002 and 2 January 2011. Initially funded by government vouchers of £250 (or £500 for lower-income families), these accounts allow parents to save up to £9,000 annually. The funds belong entirely to the child and become accessible only upon turning 18.
Ms Pomfret noted that many families have forgotten about these accounts. “The government gave parents a voucher to put into savings or investments, and lots of parents did nothing, so the government put it away. Many people have just forgotten,” she said.
Key Figures and HMRC Action
The numbers are striking: 750,000 accounts worth £1.5 billion remain unclaimed, with an average balance of £2,200. HMRC has announced it will send letters to individuals aged 21 and over to alert them. However, those aged 18 to 24 can proactively search for their funds using the free GOV.UK tool.
In 2024, over 450,000 customers used the online tool with just their National Insurance number and date of birth to locate their CTF. Angela MacDonald, HMRC’s Second Permanent Secretary, said: “Thousands of accounts are sitting unclaimed – we want to reunite young people with their money. You don’t need to pay anyone to find your Child Trust Fund; search ‘find your Child Trust Fund’ on GOV.UK.”
Warning Against Third-Party Agents
Ms Pomfret warned against using third-party agents who charge fees, sometimes up to £350 or 25% of the account value. Using an agent reduces the payout and takes longer. She encouraged parents and grandparents to remind young people to check. More information is available on GOV.UK.
