CHILD TRUST FUND. Key Features of our UK Investments Child Trust Fund

Transcription

1 CHILD TRUST FUND Key Features of our UK Investments Child Trust Fund

2 The UK Investments Child Trust Fund from OneFamily This document explains the main features of the UK Investments Child Trust Fund (CTF) from OneFamily. The Financial Conduct Authority is a financial services regulator. It requires us, OneFamily, to give you this important information to help you to decide whether our UK Investments Child Trust Fund (CTF) is right for you. You should read this document carefully so that you understand what you are buying, and then keep it safe for future reference. The information in this brochure reflects our understanding of current law and HM Revenue & Customs practice, which may change. Further information is given in the Key Investor Information Document which should be read in conjunction with this Key Features booklet. UK Investments Child Trust Fund Its aims To build a tax-efficient cash lump sum for your child. No one else can take money out of the CTF, unless your child dies or is diagnosed with a terminal illness before the CTF is due to pay out. Risks The value of the CTF account will depend on investments performance and is not guaranteed As our CTF account is invested in stocks and shares, its value can fall as well as rise. So it s possible your child may get back less than you ve paid in Your child cannot take their money out of the account until they re 18 The tax rules relating to this account could change Our CTF account is a stakeholder account. This means it meets certain standards (see the next page for more details), but it does not necessarily mean the investment is suitable for your child or that its performance is guaranteed. Your commitment You agree to become the Registered Contact for the CTF and to act on behalf of your child until they reach 16. Only your child can take their money out, and only when they re 18. 2

3 Your questions answered What is a Child Trust Fund? It s a long-term savings and investment account for children born on or after 1 September The Government introduced Child Trust Funds to: ensure your child has savings when they reach 18 help your child get into the habit of saving teach your child about the benefits of saving help your child understand personal finance. The Government provided a voucher to open a CTF account. New CTF accounts are no longer available, but the rules let you transfer your existing CTF to us. What type of account is the UK Investments Child Trust Fund from OneFamily? There are three types of CTF accounts: non-stakeholder cash-based accounts non-stakeholder accounts that invest in shares stakeholder accounts. The UK Investments Child Trust Fund from OneFamily is a stakeholder account. What is a stakeholder CTF account? A stakeholder CTF must meet strict Government criteria, as shown in the table below. The table also compares stakeholder and non-stakeholder CTF accounts. Criteria Stakeholder CTF Non stakeholder CTF Minimum payment Minimum payment can be no higher than 10 Minimum payment can be higher than 10 Maximum yearly charge 1.5% per year Charges can be higher Entry fees None Can be applied Exit fees None Can be applied Switching fees None Can be applied Payment methods Must accept cheque, Direct Debit, standing order and direct credit Payment methods can be limited Allowable investments Mainly share based Shares, fixed interest investments or cash 3

4 Who can apply to transfer the account? Only the person who is the Registered Contact or Correspondent with the existing CTF provider can transfer the account. The person who opens the CTF will be the Registered Contact for the account and the main point of contact. We ll send a welcome pack with details of the account and information on how to manage it. When they reach 16, your child can apply to become the Registered Contact for their account. We ll contact them before their 16th birthday. How flexible is it? You can pay in monthly amounts from a minimum of 5, lump sums or a mixture of both. Anyone can pay into the account, and you can change how much you pay in each month. The total amount paid into a CTF in any subscription year can t exceed the maximum subscription limit for each account. This doesn t include any payments made by the Government. Please go to child-trust-funds/overview for current maximum subscription limits. A subscription year runs from one birthday to the day before the next. Please make sure you send us your payments in good time, to reach us before the end of the subscription year. If we don t receive them on time, we can t invest them until the new subscription year, and you could lose out on the allowance. Please see Section 4 Subscriptions in the terms and conditions for more information. Can I take money out? No. You can t access the money in the account, unless we ve agreed a terminal illness claim made on behalf of your child. Please see Section 7 Access in the terms and conditions for more information. Any money paid into the account is a gift to the child and can t be refunded to the payer. Where do you invest the payments? We buy units in the Santander Stockmarket 100 Tracker Growth Unit Trust IA Class, which invests in shares in a spread of companies listed on the FTSE 100 index in the UK. We process payments throughout the day, and price and value all deals on the following working day. Unit prices are quoted daily on the OneFamily website: onefamily.com/fundprices 4

5 What are the charges? We make an annual management charge of 1.5% of the value of the fund. There are no other charges. If your child s account is valued at 250 throughout the year, this means 3.75 is deducted that year. If your child s account is valued at 500 throughout the year, this means 7.50 is deducted that year. Please note, we deduct the annual management charge of 1.5% directly from the fund, not from your child s account. The charge is calculated daily on the value of the entire investment fund. We then deduct the charge on a daily basis from the fund s income, and this is reflected in the daily unit price. What happens to the account if my child dies? If your child dies, the units held in the CTF account will be sold on the day we receive all the relevant information from you. We ll then pay the value of the account to the child s estate. Do you give advice? No, we don t give advice on investments. If you re not sure whether our CTF is suitable for your child, it s worth speaking to an independent financial adviser. You may be charged for their advice. Will any commission be paid? No, we don t pay commission. If you ask an independent financial adviser for their advice, though, you may be charged for it. How will I know how my child s CTF is doing? We ll send you an annual statement if any subscriptions have been made within the last statement period. Otherwise we ll just send you statements following the child s 4th, 10th and 15th birthdays. However, we re happy to send a statement to all account holders at any time just ask. What happens when my child reaches 18? On your child s 18th birthday, the account stops being a CTF and your child can take money out of it. Only your child can do this. We ll contact them to explain their options shortly before their 18th birthday. There s no restriction on how your child uses the money from their account. 5

6 What about tax? Any income and gains made by the CTF investment are free from income tax and capital gains tax. Can I change my mind? Yes. You have 14 days from the date you receive the Welcome pack in which to change your mind. If you decide to cancel, please complete the cancellation form in the Welcome pack and return it to us at: OneFamily, West Street, Brighton, BN1 2RL If you do change your mind, the account will be cancelled. If you don t change your mind, at the end of the 14-day cancellation period, we ll request the transfer from the old provider. Can I transfer from OneFamily to another CTF or Junior ISA Provider? Yes, you can transfer your CTF from OneFamily at any time, free of charge. You ll need to transfer the whole CTF account. How can I contact you? If you have any questions, you can call us free on * You can also us: mail@onefamily.com Or write to us at: OneFamily, West Street, Brighton, BN1 2RL How do I make a complaint? If you need to complain, please contact us at the address in the How can I contact you? section below. If you can t settle your complaint with us, you may be able to refer it to the Financial Ombudsman Service. Making a complaint won t affect your legal rights. Is OneFamily a member of a compensation scheme? Yes, we re covered by the Financial Services Compensation Scheme (FSCS). Your child may be entitled to compensation from the FSCS if we cannot meet our obligations. This depends on the type of product or service and the circumstances of the claim. Most types of investment are covered for 100% up to a maximum limit of 50,000. You can get more information about compensation scheme arrangements from the FSCS at 10th Floor, Beaufort House, 15 St Botolph Street, London, EC3A 7QU. Phone: or By the way If you d like a copy of your completed transfer form, just ask and we ll send it to you. * We might record your call to help improve our training and for security purposes. We hope you don t mind. Calls to 0800 numbers are free from UK consumer landlines and mobile phones. 6

7 For more information Visit onefamily.com Call free on * * We might record your call to help improve our training and for security purposes. We hope you don t mind. Lines are open from 9am to 7pm Monday to Friday and 9am to 1pm on a Saturday. OneFamily, West Street, Brighton, BN1 2RL. OneFamily is a trading name of Engage Mutual Funds Limited (EMFL) registered in England under the Companies Act 1985, registered no Authorised and regulated by the Financial Conduct Authority (FCA). EMFL s Financial Services Register number is You can check this on the Financial Services Register at or by contacting the FCA on