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click to go back to news topics CAB Says... Child Trust Fund The government has announced that it intends to reduce and then stop all government contributions to the Child Trust Fund as follows. From 1 August, the government contributions for children born from August 2010 will be reduced: • from £250 to £50 for better off families; and • from £500 to £100 for those on lower incomes (whose household income is less than £16,190). The government contributions for children who turn 7 on or after 1 August will be stopped. The additional contributions for disabled children will continue to be paid this year. In Wales, children receive extra contributions. The way in which these extra contributions will be treated will be determined by the Welsh Assembly. From January 2011, the government will not be issuing any new Child Trust Fund vouchers. The rules governing Child Trust Funds will continue as usual. This means that: • Child Trust Fund accounts already in existence will continue to operate as they do currently • vouchers will continue to be issued inviting parents to open Child Trust Fund accounts for their children until January 2011 • vouchers that have already been issued will continue to be valid up to their expiry date and • government contributions into Child Trust Fund accounts will continue to be made at current levels until 1 August. Further information on the government announcement on the Child Trust Fund is available on the HM Revenue and Customs (HMRC) website at www.hmrc.gov.uk |