Grandparent opening savings account for grandson who lives abroad

[cocoya]

Just looking for a bit of advice into doing this. My Mum is a UK citizen currently residing in the UK. She is wanting to put a lump sum into a savings account for my son to access once he turns 18.
My son (and myself) currently reside outside of the UK and we are both UK citizens. We have no plans to move to the UK anytime soon.
Is my Mum able to open an account for my son even though he is not residing in the UK? If so, which would be the best option?
Thanks in advance for any advice on the subject

My parents tried to do this for my kids... they are in the UK but we aren't. It was really difficult and in the end I've just opened one up where I live, they give me money and I put it in the account here for them

Thanks for your reply - it does seem to be really complicated to do. Do you have to watch the gift limit each year? I think in the UK you can give 3k per year as a gift without having to pay tax on it?

In which country is the child? It mostly comes down to how the tax authorities of that country tax their residents. It might be possible but too complicated and inefficient from a tax perspective

One option might be to put it in premium bonds for your son. You don't need to be a UK resident to hold premium bonds and grandparents can invest directly for their grandchildren. But you have to check the rules of the country you are in - eg I think they are not allowed eg for US residents due to gambling legislation. Winnings are also tax free so don't tend to count as income. May not be a great investment though.

In terms of gifts, from a UK perspective, you currently don't pay tax on gifts. Your parents can give gifts of any value but they may count against IHT allowances if they die within 7 years of making the gift. The £3000 is an annual exemption for IHT (but is only relevant if their estate is likely to be over the threshold). There may be local rules in the country you are resident in about receiving gifts and whether they are taxable. The other one to be careful about is whether there are local rules about holding bank accounts overseas. I know eg in Italy, you have to declare foreign accounts, or there are large fines.

Thank you so much for taking the time for in depth responses. The child lives in an overseas territory which does not impose income, inheritance, or capital gains taxes which makes the stocks investment desirable. Premium bonds are a great option, I actually have some myself, and hadn't thought about that so will look into that,