Amendments to ISA and Child Trust Funds legislation take effect

HM Revenue and Customs published a tax information and impact note on 15 March 2023 setting out free-standing amendments to the legislation governing Individual Savings Accounts and Child Trust Funds¹. The changes take effect from 6 April 2023¹.

The note states the purpose of the amendments in four points. They are intended to accommodate changes to other legislation, clarify the position in cases of doubt, provide additional safeguards for investors, and protect the integrity of the tax-free savings landscape¹.

"From 6 April 2023, government will introduce a range of free-standing amendments to the Individual Savings Accounts and Child Trust Funds legislation."

HM Revenue and Customs, Individual Savings Accounts and Child Trust Funds: regulation changes¹

The published note does not set out the text of the individual amendments, the accounts or products affected, or any change to subscription limits, and none of these details has been reported in the document¹. The note describes the amendments as free-standing, meaning they sit alongside rather than replace the existing ISA and Child Trust Fund rules¹.

Why it matters for households

Anyone holding either type of account, or opening one from that date, is within the scope of the legislation being amended¹.

The stated aims include additional safeguards for investors and clarification where the position is in doubt¹. The note does not identify which specific situations or account features those safeguards and clarifications cover, so the practical effect on individual accounts has not been reported¹.

For Child Trust Fund holders, the amendments sit alongside the existing rules on what the accounts are, what happens when the holder turns 18, and how to claim Child Trust Funds: what they are, what happens at 18 and how to claim. Separate arrangements already exist for moving a Child Trust Fund into a Junior ISA and for finding a lost Child Trust Fund, and for holding a Junior ISA alongside a Child Trust Fund; the note does not state whether any of these are affected¹.

No change to ISA subscription limits, allowance amounts or the tax treatment of ISA and Child Trust Fund savings is set out in the note¹. The wider rules on tax-free saving through investing within an ISA are not addressed in the document beyond the four stated aims¹.