The Child Trust Funds Regulations 2004

Interpretation U.K.

2.—(1) In these Regulations—

(a) the following expressions have the meanings given in the Child Trust Funds Act 2004 (“the Act”)—

• “child”

• “child trust fund”

• “eligible child”

• [F1 “the income threshold” (see section 9(6) of the Act)]

• “Inland Revenue”

• “Inland Revenue contributions” (see section 11(2) of the Act),

• “parental responsibility” (see section 3(9) of the Act);

• [F1 “the relevant income” (see section 9(6) of the Act)]

• “relevant person” (see section 15(2) of the Act),

• [F1 “relevant social security benefit” (see section 9(6) of the Act)]

• “responsible person”, in relation to a child under 16 (see section 3(8) of the Act),

• [F1 “tax year” (see section 9(6) of the Act)]

• “the person entitled to child benefit in respect of the child” (see section 2(1)(a), (4) and (6) of the Act);

(b) except where the context otherwise requires—

• “account” means a scheme of investment which (except in regulation 22(1)) qualifies as a child trust fund, other than in the cases of—

  (i)

  an account with a deposit-taker,

  (ii)

  a share or deposit account with a building society, or

  (iii)

  a deposit account with a person falling within [F2 section 991(2) of the Income Tax Act 2007], or a [F3 credit union];

• an “account investment” is an investment under the account which is a qualifying investment for an account within the meaning of regulation 12;

• an “account provider” is a person who fulfils the conditions of these Regulations and is approved by the Board for the purpose of these Regulations as an account provider;

• [F4 “adoption order” has the meaning in section 46(1) of the Adoption and Children Act 2002 or section 28 of the Adoption and Children (Scotland) Act 2007 or of “Adoption Order” in Article 2(2) of the Adoption (Northern Ireland) Order 1987, as the case may be, and includes any corresponding order under the Adoption (Scotland) Act 1978, and any order of a court in the Isle of Man or any of the Channel Islands which, under section 108 of the Adoption and Children Act 2002, is declared to correspond to an adoption order made under that Act;]

• “appointed day” means the day appointed, under section 27 of the Act, for the purposes of sections 8 and 9 of the Act;

• “assurance undertaking” has the meaning in Article 2 of the Council Directive of 5th November 2002 concerning life assurance (2002/83/EC) M1 ;

• [F5 “Bank of England base rate” means the rate announced from time to time by the Monetary Policy Committee of the Bank of England as the official dealing rate, being the rate at which the Bank is willing to enter into transactions for providing short-term liquidity in the money markets;]

• [F6 “the Board” means the Commissioners for Her Majesty’s Revenue and Customs;]

• “building society” means a building society within the meaning of the Building Societies Act 1986 M2 , or the Irish Building Societies Act 1989 M3 ;

• [F7 “building society bonus”, except in regulation 24(a)(i), excludes any bonus, distribution of funds or the conferring of rights in relation to shares—

  (a)

  in connection with an amalgamation, transfer of engagements or transfer of business of a building society, and

  (b)

  mentioned in section 96 or 100 of the Building Societies Act 1986,

  and “payment under a building society bonus scheme” shall be construed accordingly;]

• “company”, except in regulation 12(4)(a), means any body corporate having a share capital other than—

  (i)

  an open-ended investment company, within the meaning given by section 236 of the Financial Services and Markets Act 2000 M4 ,

  (ii)

  a UCITS,

  (iii)

  [F8 a registered society], or

  (iv)

  a body corporate which is a 51 per cent. subsidiary of any [F9 registered society];

• [F10 “credit union” means a society registered as a credit union under the Industrial and Provident Societies Act 1965 or the Credit Unions (Northern Ireland) Order 1985;]

• “deposit-taker” has the meaning given by [F11 section 853 (as extended under section 854) of ITA 2007];

• “the Director of Savings” has the same meaning as in the National Debt Act 1972 M5 ;

• “the Distance Marketing Directive” means Directive 2002/65/EC of the European Parliament and of the Council of 23rd September 2002 M6 , and includes any provisions by which an EEA State or the United Kingdom has transposed the Directive or has corresponding obligations in its domestic law, and “distance contract” has the meaning in that Directive;

• “electronic communications” includes any communications by means of a telecommunication system (within the meaning in the Telecommunications Act 1984 M7 );

• [F12 “EEA Agreement” means the agreement on the European Economic Area signed at Oporto on 2nd May 1992, together with the Protocol adjusting that Agreement signed at Brussels on 17th March 1993, as modified or supplemented from time to time;]

• [F12 “EEA State”, in relation to any time, means a state which at that time is a member State, or any other state which at that time is a party to the EEA Agreement;]

• “European institution” means an EEA firm of the kind mentioned in [F13 paragraph 5(a) to (d), (f) and (h)] of Schedule 3 to the Financial Services and Markets Act 2000 which is an authorised person for the purposes of that Act as a result of qualifying for authorisation under paragraph 12[F14 (1) to (4) and (7)] of that Schedule;

• “51 per cent. subsidiary” and “75 per cent. subsidiary” have the meanings given by section 838 of the Taxes Act;

• [F4 “FISMA 2000” means the Financial Services and Markets Act 2000;]

• “gains”, except in regulations 22(1) to (3), 24(a)(ii), (iii) and (v), 37(5) and 38, means “chargeable gains” within the meaning in the 1992 Act;

• “gilt-edged securities” has the meaning given by paragraphs 1 and 1A of Schedule 9 to the 1992 Act M8 ;

• [F4 “guardian” means a guardian of a child within the meaning in section 5 of the Children Act 1989, section 7 of the Children (Scotland) Act 1995 or Article 2(2) of the Children (Northern Ireland) Order 1995, as the case may be;]

• “incorporated friendly society” means a society incorporated under the Friendly Societies Act 1992 M9 ;

• F15 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• “investments under the account” has the same meaning as investments under a child trust fund in the Act;

• [F16 “investment trust” refers to a company that is such a trust for the purposes of the Corporation Tax Acts, or would be such a trust but for section 1158(3) of the Corporation Tax Act 2010;]

• [F4 “ITA 2007” means the Income Tax Act 2007;]

• [F4 “ITTOIA 2005” means the Income Tax (Trading and Other Income) Act 2005;]

• “the Management Act” means the Taxes Management Act 1970 M10 ;

• “market value” shall be construed in accordance with section 272 of the 1992 Act;

• “the 1992 Act” means the Taxation of Chargeable Gains Act 1992;

• F17 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• [F18 “non-UCITS retail scheme”—

  (a)

  has the meaning in COLL (that is, a scheme to which, or to whose authorised fund manager and depositary, sections 5.1, 5.4 and 5.6 of COLL apply),

  (b)

  includes a “recognised scheme” by virtue of section F19 ... 272 of FISMA 2000, which would fall within paragraph (a) of this definition if it were an authorised fund, and

  (c)

  includes a sub-fund of an umbrella which the terms of the scheme identify as a sub-fund which would fall within paragraph (a) or (b) of this definition if it were itself an authorised fund or a recognised scheme.

  In this definition, expressions defined in the Glossary of the Financial Conduct Authority Handbook have those defined meanings;]

• “notice”, except in regulations 12(12) and 37(6)(a), means notice in writing;

• [F20 “qualifying units in or shares of a non-UCITS retail scheme” means that—

  (a)

  the instrument constituting the scheme secures that redemption of the units or shares in question shall take place no less frequently than bi-monthly (see [F21 section] 6.2.16(6) of the F22 ... [F23 COLL] omitting the words “Except where (7) applies, and”, read with [F21 section] 6.3.4(1), whether or not those [F21 sections] apply to the scheme), and

  (b)

  a provision for suspension of dealings in exceptional conditions in accordance with [F21 section] 7.2 of [F24 the COLL] (or any foreign procedure which is a direct foreign equivalent of that [F21 section]) shall not be treated as a provision contrary to paragraph (a) of this definition;]

• “recognised stock exchange” has the same meaning as in [F25 section 1005 of ITA 2007];

• “registered friendly society” has the meaning given by the Friendly Societies Act 1992 and includes any society that by virtue of section 96(2) of that Act is to be treated as a registered friendly society;

• [F26 “registered society” means—

  (a)

  a registered society within the meaning given by section 1(1) of the Co-operative and Community Benefit Societies Act 2014; or

  (b)

  a society registered or deemed to be registered under the Industrial and Provident Societies Act (Northern Ireland) 1969;]

• [F27 “relevant authorised person” means a firm mentioned in section 697(2)(b) of ITTOIA 2005];

• F17 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• “security” means any loan stock or similar security of a company whether secured or unsecured;

• [F4 “special guardian” has the meaning in section 14A of the Children Act 1989;]

• “subscriptions” has the meaning in section 12(1) of the Act (but excluding Inland Revenue contributions and income or gains arising from investments under the account);

• “tax” where neither income tax nor capital gains tax is specified means either of those taxes;

• “the Taxes Act” means the Income and Corporation Taxes Act 1988;

• “year” except in the expression “subscription year” in regulations 9, 21(5)(b) and 32(2)(b)(iv), means a year of assessment (within the meaning in section 832(1) of the Taxes Act, or section 288(1) of the 1992 Act, as the case may be);

(c)

• “authorised fund” means—

  (i)

  an authorised unit trust, or

  (ii)

  an open-ended investment company F28 ... in the case of which an authorisation order made F29 ... under regulation 14 of the Open-Ended Investment Companies Regulations 2001 M11 is in force;

• “authorised unit trust” means a unit trust scheme in the case of which an authorisation order F30 ... under section 243 of the Financial Services and Markets Act 2000 is in force;

• [F31 “COLL” means the Collective Investment Schemes Sourcebook made by the Financial Conduct Authority under FISMA 2000;]

• “depositary interest” means the rights of the person mentioned in paragraph (ii), under a certificate or other record (whether or not in the form of a document) acknowledging—

  (i)

  that a person holds relevant investments or evidence of the right to them, and

  (ii)

  that another person is entitled to rights in or in relation to those or identical relevant investments, including the right to receive such investments, or evidence of the right to them or the proceeds from such investments, from the person mentioned in paragraph (i),

  where “relevant investments” means investments which are exclusively qualifying investments for an account falling within regulation 12(2)(a) to (i), and the rights mentioned in paragraph (ii) are exclusively rights in or in relation to relevant investments;

• F32 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• [F33 “insolvency event” means the procedures listed in the definition of “insolvency event” in regulation 19(15) of the Payment Services Regulations 2009;]

• F32 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• “open-ended investment company” [F34 means a company to which section 236 of FISMA 2000 applies], and “shares” in relation to an open-ended investment company, includes shares of any class and of any denomination of a given class and, in relation to a part of an umbrella company, means shares in the company which confer for the time being rights in that part;

• [F33 “recognised UCITS” means—

  (a)

  a collective investment scheme constituted in an EEA State, which is a “recognised scheme” under section 264 of FISMA 2000, and complies with the requirements to be a “UCITS scheme” for the purposes of the [F35 COLL], or

  (b)

  a part of a recognised UCITS mentioned in paragraph (a) of this definition, which would be a sub-fund of an umbrella scheme which is a recognised UCITS;]

• F32 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• F32 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• F36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• [F33 “UK UCITS” means—

  (a)

  a collective investment scheme [F37 with Part 4A permission under FISMA 2000], which complies with the requirements to be a “UCITS scheme” for the purposes of the [F38 COLL], or

  (b)

  a part of a UK UCITS mentioned in paragraph (a) of this definition which would be a sub-fund of an umbrella scheme which is a UK UCITS;]

• “umbrella scheme” means an authorised fund which according to the terms of the scheme is an umbrella scheme belonging to the category under that name established by the [F39 Financial Conduct Authority], and

  (i)

  in the case of an authorised fund which is an authorised unit trust, references to a part of an umbrella scheme shall be construed in accordance with subsection (8) of section 468 of the Taxes Act, [F40 and paragraphs (6) and (7) of regulation 7 of the Authorised Investment Funds (Tax) Regulations 2006 shall apply for the purposes of these Regulations as they apply for the purposes of those Regulations]; and

  (ii)

  in the case of an authorised fund which is an open-ended investment company, references to a part of an umbrella scheme shall be construed in accordance with [F41 subsection (4) of section 468A of the Taxes Act, and paragraphs (2) and (3) of regulation 7 of the Authorised Investment Funds (Tax) Regulations 2006 shall apply for the purposes of these Regulations as they apply for the purposes of those Regulations];

• F36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• F36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• “units”, in relation to an authorised unit trust, means the rights or interests (however described) of the unit holders in that unit trust and, in relation to a part of an umbrella scheme, means the rights or interests for the time being of the unit holders in that part;

• [F33 “units in, or shares of, a UK UCITS or recognised UCITS” means the rights (however described) of the holders of the units or shares in that UK UCITS or recognised UCITS;]

• F32 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F42 (1A) In these Regulations—

(a) a “bulk transfer of accounts” occurs where two or more accounts are transferred, without a break in the management of the accounts, by an account provider (“the transferor”) direct to another account provider (“the transferee”)—

(i) pursuant to an agreement made between the transferor and the transferee where the transfers are not made pursuant to requests made by the person who is the registered contact in relation to the accounts transferred; or

(ii) pursuant to an insurance business transfer scheme or a banking business transfer scheme under Part 7 (Control of Business Transfers) of FISMA 2000;

F43 (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F43 (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ]

(2) The table below indexes other definitions in these Regulations—

Term defined	Regulation
“the applicant”	5
“the commencement date”	7(8)
“description” of an account	4
“the disqualifying circumstances”	16
F44 . . .	F44 . . .
F44 . . .	F44 . . .
“initial contribution”	7(1)
“interim tax claim”	26(2)
“local authority”	33(1)
“looked after child”	33(1)
“management agreement”	5
“the named child”	5 and 8(1)
“qualifying circumstances”	14
“qualifying investments for an account”	12
“registered contact”	8(1)(d)
F44 . . .	F44 . . .
“special contribution”	7(1)
“subscription year”	9(2)
“supplementary contribution”	7(5)
“the termination event”	12(12)
“the transfer instructions”	8(2)(h)
“the internal transfer instructions”	8(2)(i)

Textual Amendments

F1 Words in reg. 2(1)(a) added (with effect in accordance with reg. 1(2) of the amending S.I.) by The Child Trust Funds (Amendment) Regulations 2009 (S.I. 2009/475), regs. 1(1), 3

F2 Words in reg. 2(1)(b) substituted (6.4.2014) by The Child Trust Funds (Amendment) Regulations 2014 (S.I. 2014/649), regs. 1, 3(a)

F3 Words in reg. 2(1)(b) substituted (6.4.2010) by The Child Trust Funds (Amendment) Regulations 2010 (S.I. 2010/582), regs. 1, 3(1)(a)

F4 Words in reg. 2(1)(b) inserted (6.4.2010) by The Child Trust Funds (Amendment) Regulations 2010 (S.I. 2010/582), regs. 1, 3(1)(g)

F5 Words in reg. 2(1)(b) inserted (6.4.2005) by The Child Trust Funds (Amendment) Regulations 2004 (S.I. 2004/2676), regs. 1, 3

F6 Words in reg. 2(1)(b) substituted (27.12.2005) by The Child Trust Funds (Amendment No. 3) Regulations 2005 (S.I. 2005/3349), regs. 1, 3(a)

F7 Words in reg. 2(1)(b) inserted (1.1.2007) by The Child Trust Funds (Amendment No. 3) Regulations 2006 (S.I. 2006/3195), regs. 1, 3

F8 Words in reg. 2(1)(b) substituted (1.8.2014) by The Co-operative and Community Benefit Societies and Credit Unions Act 2010 (Consequential Amendments) Regulations 2014 (S.I. 2014/1815), reg. 1(2), Sch. para. 13(a)(i)

F9 Words in reg. 2(1)(b) substituted (1.8.2014) by The Co-operative and Community Benefit Societies and Credit Unions Act 2010 (Consequential Amendments) Regulations 2014 (S.I. 2014/1815), reg. 1(2), Sch. para. 13(a)(ii)

F10 Words in reg. 2(1)(b) inserted (6.4.2005) by The Child Trust Funds (Amendment No. 2) Regulations 2005 (S.I. 2005/909), regs. 1, 3

F11 Words in reg. 2(1)(b) substituted (6.4.2010) by The Child Trust Funds (Amendment) Regulations 2010 (S.I. 2010/582), regs. 1, 3(1)(b)

F12 Words in reg. 2(1)(b) substituted (5.8.2013) by The Child Trust Funds (Amendment No. 2) Regulations 2013 (S.I. 2013/1744), regs. 1, 3(a)

F13 Words in reg. 2(1)(b) substituted (6.4.2014) by The Child Trust Funds (Amendment) Regulations 2014 (S.I. 2014/649), regs. 1, 3(b)

F14 Words in reg. 2(1)(b) inserted (6.4.2014) by The Child Trust Funds (Amendment) Regulations 2014 (S.I. 2014/649), regs. 1, 3(b)

F15 Words in reg. 2(1)(b) omitted (1.8.2014) by virtue of The Co-operative and Community Benefit Societies and Credit Unions Act 2010 (Consequential Amendments) Regulations 2014 (S.I. 2014/1815), reg. 1(2), Sch. para. 13(b)

F16 Words in reg. 2(1)(b) substituted (6.4.2014) by The Child Trust Funds (Amendment) Regulations 2014 (S.I. 2014/649), regs. 1, 3(c)

F17 Words in reg. 2(1)(b) omitted (6.4.2010) by virtue of The Child Trust Funds (Amendment) Regulations 2010 (S.I. 2010/582), regs. 1, 3(1)(d)

F18 Words in reg. 2(1)(b) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 93(a)(i)

F19 Words in reg. 2(1)(b) omitted (22.7.2013) by virtue of The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 18

F20 Words in reg. 2(1)(b) inserted (27.12.2005) by The Child Trust Funds (Amendment No. 3) Regulations 2005 (S.I. 2005/3349), regs. 1, 3(b)

F21 Words in reg. 2(1)(b) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 93(a)(ii)(cc)

F22 Word in reg. 2(1)(b) omitted (6.4.2010) by virtue of The Child Trust Funds (Amendment) Regulations 2010 (S.I. 2010/582), regs. 1, 3(1)(e)

F23 Word in reg. 2(1)(b) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 93(a)(ii)(aa)

F24 Words in reg. 2(1)(b) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 93(a)(ii)(bb)

F25 Words in reg. 2(1)(b) substituted (5.8.2013) by The Child Trust Funds (Amendment No. 2) Regulations 2013 (S.I. 2013/1744), regs. 1, 3(b)

F26 Words in reg. 2(1)(b) inserted (1.8.2014) by The Co-operative and Community Benefit Societies and Credit Unions Act 2010 (Consequential Amendments) Regulations 2014 (S.I. 2014/1815), reg. 1(2), Sch. para. 13(c)

F27 Words in reg. 2(1)(b) substituted (6.4.2010) by The Child Trust Funds (Amendment) Regulations 2010 (S.I. 2010/582), regs. 1, 3(1)(f)

F28 Words in reg. 2(1)(c) omitted (6.4.2010) by virtue of The Child Trust Funds (Amendment) Regulations 2010 (S.I. 2010/582), regs. 1, 3(2)(a)

F29 Words in reg. 2(1)(c) omitted (1.4.2013) by virtue of The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 93(b)(i)

F30 Words in reg. 2(1)(c) omitted (1.4.2013) by virtue of The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 93(b)(ii)

F31 Words in reg. 2(1)(c) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 93(b)(iii)

F32 Words in reg. 2(1)(c) omitted (6.4.2010) by virtue of The Child Trust Funds (Amendment) Regulations 2010 (S.I. 2010/582), regs. 1, 3(2)(b)

F33 Words in reg. 2(1)(c) inserted (6.4.2010) by The Child Trust Funds (Amendment) Regulations 2010 (S.I. 2010/582), regs. 1, 3(2)(f)

F34 Words in reg. 2(1)(c) substituted (6.4.2010) by The Child Trust Funds (Amendment) Regulations 2010 (S.I. 2010/582), regs. 1, 3(2)(c)

F35 Word in reg. 2(1)(c) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 93(b)(iv)

F36 Words in reg. 2(1)(c) omitted (6.4.2010) by virtue of The Child Trust Funds (Amendment) Regulations 2010 (S.I. 2010/582), regs. 1, 3(2)(d)

F37 Words in reg. 2(1)(c) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 93(b)(v)(aa)

F38 Word in reg. 2(1)(c) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 93(b)(v)(bb)

F39 Words in reg. 2(1)(c) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 93(b)(vi)

F40 Words in reg. 2(1)(c) substituted (6.4.2010) by The Child Trust Funds (Amendment) Regulations 2010 (S.I. 2010/582), regs. 1, 3(2)(e)(i)

F41 Words in reg. 2(1)(c) substituted (6.4.2010) by The Child Trust Funds (Amendment) Regulations 2010 (S.I. 2010/582), regs. 1, 3(2)(e)(ii)

F42 Reg. 2(1A) inserted (5.8.2013) by The Child Trust Funds (Amendment No. 2) Regulations 2013 (S.I. 2013/1744), regs. 1, 4

F43 Reg. 2(1A)(b)(c) omitted (6.4.2015) by virtue of The Child Trust Funds (Amendment No. 2) Regulations 2015 (S.I. 2015/876), regs. 1, 3

F44 Words in reg. 2(2) Table omitted (with effect in accordance with reg. 1(2) of the amending S.I.) by virtue of The Child Trust Funds (Amendment) Regulations 2013 (S.I. 2013/263), reg. 2(4)(b)

Marginal Citations

M1 O.J. L345, 19.12.2002, p. 1.

M2 1986 c. 53.

M3 Number 17 of 1989.

M4 2000 c. 8.

M5 1972 c. 65.

M6 O.J. L271, 9.10.2002, p. 16.

M7 1984 c. 12.

M8 1992 c. 12.

M9 1992 c. 40.

M10 1970 c. 9.

M11 S.I. 2001/1228.