Everything You Need to Know About The Child Trust Fund

Written By Citizens Advice

Across the United Kingdom, hundreds of thousands of young adults are unknowingly sitting on a small fortune. Recent data from HM Revenue and Customs (HMRC) indicates that over 750,000 matured accounts remain unclaimed, with the total value of these forgotten pots exceeding £1.5 billion. If you were born in the UK between 2002 and 2011, a Child Trust Fund was likely opened in your name, and it could now be worth significantly more than the initial government contribution.

At Citizens Advice Lancashire West, we understand that navigating financial systems can be daunting. Whether you are a young person looking for your own money or a parent trying to help your child, this guide provides the professional, impartial advice you need to trace, manage, and access these vital funds without paying a penny in fees.

What is a Child Trust Fund?

A Child Trust Fund is a long-term, tax-free savings account established by the UK government for children born between 1 September 2002 and 2 January 2011. The initiative was designed to ensure that every young person arrived at adulthood with a financial cushion, regardless of their family background.

Initially, the government provided vouchers of £250 (or £500 for lower-income households) to start the fund. In many cases, if parents did not open an account within a year of receiving the voucher, HMRC opened one on the child’s behalf. These accounts were often placed with providers that parents might not recognise today, leading to the current situation where millions of pounds remain in 'lost' or forgotten accounts.

Key Features of the Scheme

  • Tax-Free Growth: Any interest or investment gains made within the fund are exempt from UK income tax and capital gains tax.

  • Ownership: The money belongs to the child and cannot be accessed by parents or guardians for their own use.

  • Control at 16: When the account holder turns 16, they can take over the management of the account, though they cannot withdraw the money yet.

  • Access at 18: Once the account holder reaches 18, the fund 'matures,' and they can choose to withdraw the cash or transfer it into an adult ISA.

Why Are So Many Funds Unclaimed?

The primary reason for the high volume of unclaimed money is the 'default' account system. When HMRC opened accounts for families who hadn't used their vouchers, the details were often filed away and forgotten. Over the last two decades, families have moved house, providers have merged or changed names, and the original paperwork has frequently been lost.

According to HMRC reports (2025), more than 60% of unclaimed matured funds have been sitting idle for over a year. This highlights a significant gap in awareness among young adults who are now eligible to claim their money but are unaware the account even exists.

How to Find Your Child Trust Fund for Free

You should never pay a commercial 'tracing service' to find your account. The process is straightforward and free when using official government channels. There are two primary ways to locate a lost Child Trust Fund:

1. Use the Official HMRC Tracing Tool

The most reliable method is the free tool provided on the GOV.UK website. You can use this service if you are 16 or older and looking for your own fund, or if you are a parent or guardian of a child under 18. You will need to sign in using a Government Gateway user ID. If you do not have one, you can create one during the process.

2. The Share Foundation

The Share Foundation is a registered charity that works closely with the government to help young people, particularly those who have been in the care system, find their accounts. They offer a free search service that can be particularly helpful if you are struggling with the HMRC online form.

What Information Do You Need?

To make the search as quick as possible, you should have the following details ready:

  • National Insurance Number: This is the most important piece of information. You can find this on your NI card, payslips, or letters about tax and benefits.

  • Full Legal Name: Include any previous names if you have changed yours.

  • Date of Birth: To verify your identity.

  • Current and Previous Addresses: This helps HMRC match you to the records held by the account provider.

Once you submit your request, HMRC will typically write to you within three weeks with the name and contact details of the provider holding your money. You then contact the provider directly to update your details and access the funds.

Managing Your Money at 16 and 18

The rules regarding who can manage the Child Trust Fund change as the young person grows up. Understanding these milestones is essential for effective financial planning.

At Age 16: Taking Control

From the age of 16, the young person is legally entitled to take over the management of their account. This means they can decide how the money is invested or move it to a different provider. However, the money must remain in the account until their 18th birthday.

At Age 18: Maturity and Withdrawal

On the 18th birthday, the account matures. The provider will usually move the money into a 'matured CTF' or a protected ISA until they receive instructions. The account holder can then:

  • Withdraw the full balance as a tax-free lump sum.

  • Transfer the balance into an adult Individual Savings Account (ISA) to continue saving tax-free.

  • Leave the money where it is, though interest rates on matured accounts may not be as competitive as other options.

Recent Regulatory Changes

It is important to stay informed about changes to savings regulations. For instance, the Child Trust Funds (Amendment) Regulations 2026 introduced new rules regarding the types of investments allowed within these accounts. Specifically, as of 6 April 2026, cryptoasset exchange-traded notes (cETNs) can no longer be added to these funds, though any held prior to this date may be retained. This reflects the government's ongoing commitment to ensuring these funds remain in relatively stable investment environments.

How Citizens Advice Lancashire West Can Help

If you are based in Chorley or the wider Lancashire area and are having difficulty tracing an account, or if you are unsure what to do with the money once you have found it, Citizens Advice Lancashire West is here to help. We provide free, confidential, and impartial advice on a wide range of financial matters.

Our team can assist you with:

  • Navigating the HMRC online tracing process.

  • Understanding the tax implications of your savings.

  • Budgeting and financial planning for the future.

  • Advice on debt or benefits that may be affected by receiving a lump sum.

We are committed to ensuring that every young person in our community has the opportunity to claim what is rightfully theirs and use it to build a secure financial future.

Conclusion

A Child Trust Fund is more than just a savings account; it is a financial head start that millions of UK citizens are entitled to. With over £1.5 billion waiting to be claimed, there has never been a better time to check if you or your child has a forgotten pot of money. The process is free, secure, and could provide a significant boost to your financial well-being.

If you need support with this process or any other financial matter, please contact Citizens Advice Lancashire West. Our expert advisers are ready to provide the high-quality, client-centered support you need to navigate your financial journey with confidence.

Sources

Citizens Advice
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