Bank accounts for children | General comparisons | Discussion forum

My understanding is that in-trust bank accounts for minors come with their own baggage, such as who is the beneficiary in the event the child dies and how is (and who) manages the trust. For a simple bank account, these appear to be harmless subtleties, and most likely are not likely to ever be an issue, but I can understand most online banks don't want to touch them.

If the bank account for a minor is not a true in-trust account, then I understand the income is attributable back to the adult whose name is associated with the account.

Added: When we had young kids in the 1960s and 1980s, we set up in-trust bank accounts for our kids in which the Family Benefit cheques were deposited to these accounts and my wife was the named adult holder (trustee) of the account (family benefits at that time were made out to the mother of the children). We determined that while my wife had to declare the cheques on her tax return, any income attributed to the deposited cheques was attributable to the children.

I think there might have been some posts on here somewhere about bank accounts for minors. I do remember that not all minors' accounts have to be in trust - I think TD, for example, allows 12 year-olds to have their own bank account, either alone or joint, so I assume the other bricks-and-mortar banks are the same.

How do I open a Tangerine Children's Savings Account?

The first step to getting a Tangerine Children's Savings Account is to open a Savings or Chequing Account of your own, if you don’t already have one.

Then, once your own Account is up and running, opening a Tangerine Children's Savings Account is a snap. Just log in and click ‘Open a Savings Account’ on the Overview page. From there, you can select Children’s Savings Account.

You'll need to provide some of your child's personal information, so please remember to have his or her Social Insurance Number and one of the following pieces of ID when enrolling: Canadian Passport, Canadian Permanent Resident Card, Canadian Secure Certificate of Indian Status, Provincial or Territorial Identification Cards, Birth Certificate (only an option for children 11 and under), Canadian Citizenship Card or Certificate (only an option for children 11 and under)

AltaRed said
Added: When we had young kids in the 1960s and 1980s, we set up in-trust bank accounts for our kids in which the Family Benefit cheques were deposited to these accounts and my wife was the named adult holder (trustee) of the account (family benefits at that time were made out to the mother of the children). We determined that while my wife had to declare the cheques on her tax return, any income attributed to the deposited cheques was attributable to the children.  

Interesting, but I'm not sure if that was legally challenged. At any rate, all government allowances for children are tax-free benefits so it's a bit of a moot point nowadays. 🙂

Cheers,
Doug

My understanding is that a child can get a debit card at age 13 and empty a bank account parent contributed to (after parent had set it up solely in child's name when child was born, i.e. not joint, not "in trust").

Can child do the same if bank account was set up in name "Parent, In Trust for Child" (i.e. still not joint)? Or would child have to wait to age 18 to empty it if it's held in (informal) trust name?

When our daughter was young, we setup a separate account in our name and accumulated "her" money there. On her 18th BD, we gifted her "her" funds...

Thanks, Norman1, so it looks like you can defer the minor child's access to the account for a few years by opening the account as "Parent Name, In Trust for Child Name" vs "Child Name". Cool!

The usual attribution rules apply for tax on the earnings in an informal in-trust account.

The details are in the section "How are they taxed?" of the article I mentioned.