You are here: ASDA Financial Services > Guides > ASDA Child Trust Fund Account Jargon Buster. Find out more!

ASDA Child Trust Fund Account Jargon Buster. Find out more!

Child Trust Fund - The Child Trust Fund (CTF) is a scheme introduced by the government to help give children in the UK a financial head start at 18. The government has given the parents of each eligible child in the UK born since 1st September 2002 a Child Trust Fund voucher which can only be used to open and kick-start a Child Trust Fund account. Most vouchers are for £250.

Stakeholder – The Asda Child Trust Fund is a stakeholder account, provided by The Children’s Mutual. Stakeholder accounts include all the features required by the government and are the government’s preferred kind of Child Trust Fund account. Until the child turns 13, all money put into the account is invested in a fund holding company shares. Once the child reaches 13, the money is switched into lower risk investments such as cash and government bonds, or a fund holding this sort of investment. As the investment is shares-based for most of the life of the account, your child could get back less than has been paid in.

Pre-register – You can register your interest in the Asda Child Trust Fund before your baby is even born by ‘pre-registering’ for more information online. When you pre-register online, you’ll also automatically be entered into a prize draw to win a £100 Asda Gift Card! You’ll then be sent an information and application pack around the time of your baby’s due date to make it easier for you to apply for a Child Trust Fund.

Tax-free – There is no income tax or capital gains tax to be paid on any growth in the value of the Asda Child Trust Fund account. However, there may be a tax on any dividends earned by the shares that your child’s Child Trust Fund has been invested in, which cannot be reclaimed. Provided your child is a UK resident when their account matures at 18, they won’t have any tax to pay on the amount they receive.

Top-up – Anyone can ‘top-up’ a child’s Child Trust Fund by making additional payments into the account – either by setting up a Direct Debit for regular monthly payments or making one-off payments. Parents, friends and family can pay in up to a total of £1,200 in a year (birthday to birthday) between them into the child’s Child Trust Fund.

Registered Contact – this is the person who is authorised to control the child’s Asda Child Trust Fund and give instructions as to how the money is invested. The registered contact must be 16 years old or over and have parental responsibility for the child. Once the child reaches 16 only they can be the Registered Contact.

Unique Reference Number (URN) – this is the unique number that is used to identify each child’s Child Trust Fund account. Each child will have a different URN. The URN can be found in the top right corner of the government Child Trust Fund voucher.