TheGrahams Posted February 20 Share Posted February 20 My kids have children trust funds back in the UK which the grandparents have been paying into. My eldest turns 18 this year and the youngest in 2 years. Has anyone had any luck in getting theirs transferred to an Aus bank? Granny has been in touch with nationwide and they said a cheque will be issued but Aus banks don't accept foreign cheques anymore! Quote Link to comment Share on other sites More sharing options...
BendigoBoy Posted February 20 Share Posted February 20 I think Great Southern still accept foreign cheques. 1 Quote Link to comment Share on other sites More sharing options...
Marisawright Posted February 20 Share Posted February 20 45 minutes ago, TheGrahams said: Aus banks don't accept foreign cheques anymore! What? $%%^&*)O! The cheek of them! I couldn't believe it and just Googled. I had to laugh (in a bad way) at the ANZ page about this. They explain they're making a "change to foreign cheques" (of course they couldn't be so honest as to say, "We're not accepting them" directly. Then they have a whole page telling you what you can do with each type of foreign cheque -- which in every case boils down to "talk to the people who are giving you the cheque, because we're not interested". And then finally they finish off with "We're here to help"!!!! Yeah, sure you are. Apparently some of the smaller banks are still taking foreign cheques. 1 Quote Link to comment Share on other sites More sharing options...
TheGrahams Posted February 21 Author Share Posted February 21 OK, so the cheque thing may be solved. Has anyone successfully transferred a CTF into an Aus bank account? 1 Quote Link to comment Share on other sites More sharing options...
Marisawright Posted February 21 Share Posted February 21 (edited) 20 minutes ago, TheGrahams said: Has anyone successfully transferred a CTF into an Aus bank account? Is there any reason the funds can't be transferred into an ordinary UK bank account, then it can be transferred from there to an Australian bank account in the normal way? Mindyou, I would still use a service like Wise to do the transfer, unless you bank with a low-fee bank like HSBC Edited February 21 by Marisawright Quote Link to comment Share on other sites More sharing options...
TheGrahams Posted February 21 Author Share Posted February 21 The children don't have a UK bank account and can't get one as they are not UK residents. I still have an active HSBC account but when the fund matures it is in their name Quote Link to comment Share on other sites More sharing options...
Marisawright Posted February 21 Share Posted February 21 4 minutes ago, TheGrahams said: The children don't have a UK bank account and can't get one as they are not UK residents. I still have an active HSBC account but when the fund matures it is in their name Could the children open a Sterling HSBC account in their name? Quote Link to comment Share on other sites More sharing options...
TheGrahams Posted February 21 Author Share Posted February 21 I'm not sure if this is possible as they are not UK residents. Quote Link to comment Share on other sites More sharing options...
rammygirl Posted February 21 Share Posted February 21 Be aware of the tax rates for minors in Aus. They may have to file a tax return. The tax free allowance is only 450 bucks a year for minors! You might want to run it past an accountant as Aus will not recognise tax free Uk accounts like isas not sure how they will treat the trust fund. Quote Link to comment Share on other sites More sharing options...
Marisawright Posted February 21 Share Posted February 21 (edited) 28 minutes ago, TheGrahams said: I'm not sure if this is possible as they are not UK residents. I meant a HSBC Australia bank account which is multi-currency. However I am assuming they would accept a sterling cheque into their sterling account and maybe they wouldn't. It does sound like the solution is to find a bank in Australia which still accepts foreign cheques, and get the kids to open accounts with that bank. The other option is for Granny to go back to the bank and ask them why they are so antiquated that they can't send the money electronically instead of giving her a cheque. Edited February 21 by Marisawright Quote Link to comment Share on other sites More sharing options...
TheGrahams Posted February 21 Author Share Posted February 21 28 minutes ago, rammygirl said: Be aware of the tax rates for minors in Aus. They may have to file a tax return. The tax free allowance is only 450 bucks a year for minors! You might want to run it past an accountant as Aus will not recognise tax free Uk accounts like isas not sure how they will treat the trust fund. He will be over 18 when the money matures but yes we are aware he may have to pay tax on it. Quote Link to comment Share on other sites More sharing options...
TheGrahams Posted February 21 Author Share Posted February 21 25 minutes ago, Marisawright said: I meant a HSBC Australia bank account which is multi-currency. However I am assuming they would accept a sterling cheque into their sterling account and maybe they wouldn't. It does sound like the solution is to find a bank in Australia which still accepts foreign cheques, and get the kids to open accounts with that bank. The other option is for Granny to go back to the bank and ask them why they are so antiquated that they can't send the money electronically instead of giving her a cheque. Yes, the cheque converting bank sounds best but my concern is my youngest still has 2 years to wait and the likelihood of cheques even being a thing then is slim and also I don't know if he has to go in person to collect the cheque. The more I dig, the more it seems it may be the specific bank that is antiquated so I could, whilst still the registered account holder, switch to a more modern bank that has a process already set up! Who'd have tthought moving money between countries would be so difficult in 2024! Quote Link to comment Share on other sites More sharing options...
Ken Posted February 21 Share Posted February 21 (edited) 3 hours ago, TheGrahams said: The children don't have a UK bank account and can't get one as they are not UK residents. I still have an active HSBC account but when the fund matures it is in their name The children should be able to open an account with Wise and obtain a UK sort code and account number from them. Wise don't accept cheques but if the trust will transfer to a UK bank account in the child's name it's an option. They'll then be able to convert the money into AUD and transfer it on to their Australian bank account. Edited February 21 by Ken 3 Quote Link to comment Share on other sites More sharing options...
Ken Posted February 21 Share Posted February 21 1 hour ago, rammygirl said: Be aware of the tax rates for minors in Aus. They may have to file a tax return. The tax free allowance is only 450 bucks a year for minors! You might want to run it past an accountant as Aus will not recognise tax free Uk accounts like isas not sure how they will treat the trust fund. A Child Trust Fund is treated as a form of pension because the funds can't be withdrawn until the beneficiary reaches a certain age. That means there is no tax during the accumulation phase. It's taxed when the Fund matures. However at that point the beneficiary is no longer a minor and so the normal tax free allowance of $18,200 applies (plus there's the low income tax offset that effectively raises that even further). If they have a lot of other income or a very large trust fund they may be disappointed by getting a tax bill, but most 18 year olds are still in full time education and most Child Trust Funds are small so leaving no tax to pay. If they've got a very large Child Trust Fund in the UK then the people who contributed to it were very badly advised. 3 Quote Link to comment Share on other sites More sharing options...
Marisawright Posted February 21 Share Posted February 21 1 hour ago, TheGrahams said: Yes, the cheque converting bank sounds best but my concern is my youngest still has 2 years to wait and the likelihood of cheques even being a thing then is slim .... but if that's the case, then the issuing bank will probably have caught up with the rest of the world by then, and be able to transfer the proceeds by electronic transfer! Quote Link to comment Share on other sites More sharing options...
TheGrahams Posted February 21 Author Share Posted February 21 33 minutes ago, Ken said: If they've got a very large Child Trust Fund in the UK then the people who contributed to it were very badly advised. How so? The boys will get around £10K each as Granny thought this the best way to save for them Quote Link to comment Share on other sites More sharing options...
Ken Posted February 21 Share Posted February 21 1 hour ago, TheGrahams said: How so? The boys will get around £10K each as Granny thought this the best way to save for them I said a very large Child Trust Fund. £10K each (assuming they don't have any other income) will leave them with no tax to pay so I'm not calling that "very large". A very large amount would create a tax bill so would probably not have been the best way to save for them. 3 Quote Link to comment Share on other sites More sharing options...
TheGrahams Posted February 21 Author Share Posted February 21 27 minutes ago, Ken said: I said a very large Child Trust Fund. £10K each (assuming they don't have any other income) will leave them with no tax to pay so I'm not calling that "very large". A very large amount would create a tax bill so would probably not have been the best way to save for them. Oh haha! 10k is a very large amount to me!! However, taking into consideration £-$ plus his earnings from work, around 5k per year he will be well over his tax free threshold. 1 Quote Link to comment Share on other sites More sharing options...
Ken Posted February 21 Share Posted February 21 14 minutes ago, TheGrahams said: Oh haha! 10k is a very large amount to me!! However, taking into consideration £-$ plus his earnings from work, around 5k per year he will be well over his tax free threshold. There is a strong argument to make that the amounts the grandparents paid in over the years (but not the interest/investment gains) were gifts and so exempt from tax and so you should exclude them from the amount received. The problem is that if the ATO enquire into whether or not they were gifts, you could even need to prove the source of where the grandparents got the money for the gifts to show that it really was a gift and not a disguised source of income. To do this properly you should get a Private Ruling from the ATO agreeing how much of the total received was gifts - but as you aren't looking at more that $300 of tax in total (based on the rough figures given) going to that effort would cost more than it saved. 2 Quote Link to comment Share on other sites More sharing options...
calNgary Posted February 21 Share Posted February 21 12 hours ago, TheGrahams said: My kids have children trust funds back in the UK which the grandparents have been paying into. My eldest turns 18 this year and the youngest in 2 years. Has anyone had any luck in getting theirs transferred to an Aus bank? Granny has been in touch with nationwide and they said a cheque will be issued but Aus banks don't accept foreign cheques anymore! We just applied for my daughters last month. She had to send copies of ID via email, they had to speak with her personally on the phone and a few days later they bank transferred the money into her Aus bank account. It was a much easier process than i had expected. Cal x 2 Quote Link to comment Share on other sites More sharing options...
TheGrahams Posted February 21 Author Share Posted February 21 29 minutes ago, calNgary said: We just applied for my daughters last month. She had to send copies of ID via email, they had to speak with her personally on the phone and a few days later they bank transferred the money into her Aus bank account. It was a much easier process than i had expected. Cal x What bank was she with? Just been speaking to nationwide on the live chat and they are adamant they will send a cheque in GBP and there is no other way! 1 Quote Link to comment Share on other sites More sharing options...
rammygirl Posted February 21 Share Posted February 21 6 hours ago, Ken said: A Child Trust Fund is treated as a form of pension because the funds can't be withdrawn until the beneficiary reaches a certain age. That means there is no tax during the accumulation phase. It's taxed when the Fund matures. However at that point the beneficiary is no longer a minor and so the normal tax free allowance of $18,200 applies (plus there's the low income tax offset that effectively raises that even further). If they have a lot of other income or a very large trust fund they may be disappointed by getting a tax bill, but most 18 year olds are still in full time education and most Child Trust Funds are small so leaving no tax to pay. If they've got a very large Child Trust Fund in the UK then the people who contributed to it were very badly advised. That is useful to know. I wanted to open a trust shares account for my grandson (not yet one) here in Aus. So I’m assuming no tax until it is accessed at 18? This will be cash deposits as gifts birthday and Christmas I think with commbank? Quote Link to comment Share on other sites More sharing options...
calNgary Posted February 21 Share Posted February 21 11 hours ago, TheGrahams said: What bank was she with? Just been speaking to nationwide on the live chat and they are adamant they will send a cheque in GBP and there is no other way! She is with Commonwealth Bank. The trust fund was held by One Family as it was originally set up with Asda and these guys took them over. Cal x Quote Link to comment Share on other sites More sharing options...
Marisawright Posted February 21 Share Posted February 21 12 hours ago, TheGrahams said: What bank was she with? Just been speaking to nationwide on the live chat and they are adamant they will send a cheque in GBP and there is no other way! Can't your child endorse the cheque to you or someone else with a UK bank account? Quote Link to comment Share on other sites More sharing options...
TheGrahams Posted February 21 Author Share Posted February 21 23 minutes ago, Marisawright said: Can't your child endorse the cheque to you or someone else with a UK bank account? Not sure. Probably easier to open a Great Southern account for this child and hope things are easier by the time the youngest turns 18! Quote Link to comment Share on other sites More sharing options...
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