Premium bonds for children and benefits

[Hatemyhusband]

Quick question, my Dsis wants to buy my children Premium bonds as a big one off gift (about 15ks worth in total)
However, i am a working single parent who has tax credits.

I’ve read that it shouldn’t be an issue with my claim, but I’m just seeing if anyone has any experience of this?

I will be named (as per the rules) but they will be given to the kids at 16.

I’ve told Dsis to hold off until I can actually find out if it counts because I don’t want her gift to backfire on us!

I think the best thing to do would be to ask the tax credits people specifically.

I don't know the answer to your question, but if your dsis wants to give a gift to your children, do you own a house? It would be a much better use of money to put it towards a deposit with the intention to eventually give them the proceeds of that house when they are older. It's fairly straightforward to accept a gift towards a deposit. And probably a better investment.

Sadly I am renting, otherwise she would have

Savings in your name won't affect tax credits, but they can eventually affect universal credit if you ever end up claiming this. You can put the money into a junior ISA for them and it won't be counted as your savings, but then there are restrictions on accessing this www.moneyadviceservice.org.uk/en/articles/how-do-savings-and-lump-sum-pay-outs-affect-benefits

They can go in the children's own names.

Also the interest will count as your income if in your name.

I looked into this before when I was on universal credit and anything that was in my child's name that I had access to was consider under "my savings"

I can’t seem to get a definitive answer (tax credits not open on Saturdays)

I have been reading up and found an article saying it doesn’t affect either tax credits it UC but I don’t want to do this wrongly!

money.radiotimes.com/news/will-my-daughter-lose-out-on-premium-bonds-gifts/

This is what I found

The link I provided is Money Advice Service, set up by the Government - not sure if it's working, Google Money Advice Service how do savings affect benefits? I used to be a benefits adviser.

That Radio Times article is money OWNED by children, not in your name, e.g. not in your name.

Oops, not concentrating, repeating myself!

Can your sis not put them in her name and gift the children directly when the Are 18?

@pinkglove75318

Can your sis not put them in her name and gift the children directly when the Are 18?

That is an idea. I think that if she buys them directly for the children then I have to go on as the person who controls it until they are 16 as I’m the parent, but it’s not my money and not meant for me. She just wants them to have something but not see me have to cash them in to pay the rent!

I wasn’t sure if they were in the children’s names it would be ok, as they aren’t being bought for me and would be theirs at 16

Yeah actually now I'm not sure anymore! You'll definitely be fine for tax credits as capital isn't taken into account, just the interest, but capital is taken into account for UC. I'll see if I can find decision-makers guidance.

@TabbyStar

Yeah actually now I'm not sure anymore! You'll definitely be fine for tax credits as capital isn't taken into account, just the interest, but capital is taken into account for UC. I'll see if I can find decision-makers guidance.

Thankyou, the whole thing is really confusing. I tried ringing, but they are now shut on Saturday, and some of what I read tells me they aren’t entirely sure of their own rules anyway.

I would just be the controller (as such) until they were 16 as a parent has to be and I can’t trust their dad frankly.

I get if I cashed them and used them then, yes it’s technically my money, but they are a gift for the children and I can’t see why it should affect the benefits.

It’s not even my money buying them!

Undertake premium bond rules can she actually purchase these for your children?

I thought it was only parents and grandparents who can do this but it might have changed.

Best check though OP, as it might be the case she has to transfer the money first to your account for you to buy them and ttat may affect your status?

@MadamFlutterby

Undertake premium bond rules can she actually purchase these for your children?

I thought it was only parents and grandparents who can do this but it might have changed.

Best check though OP, as it might be the case she has to transfer the money first to your account for you to buy them and ttat may affect your status?

Rules changed this year, anyone can buy for children, it used to just be parents/grandparents, but the parent still has to be the guardian of the bonds

Here's the guidance for decision-makers. Looks to me for UC that it would be fine para H1077 onwards. assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/890315/admh1.pdf

I know it's okay with Junior ISAs or the old child trust funds but you'd have to check out the process for premium bonds to make it clear it's for the kids just in case you ever end up on UC.

Thanks for that! It does very much look as though as long as my sister buys them it should be ok, especially as it’s a rule that under 16s can’t hold them.
I think the trouble would be if I randomly started cashing them in (which I won’t) because then I’ve sort of made them mine.

That is a massive document btw, so Thankyou for finding it for me

Just so I’m sure (because this fries my brain) it’s absolutely fine on Tax credits anyway? That’s what I’m currently on and hoping not to move any time soon!

Yeah most people don't know they exist but they are what staff (should) refer to to make decisions, I used to love digging through them to solve benefits problems, I'd like to go back to it one day. Good luck!