what is the legal situation as regards the bank accounts people frequently open in the name of minor children?

does a minor child legally own title to such accounts and the funds? or do they legally belong to the parent?

the tax dept insists that the money is mine and therefore adds to my capital.

anyone understand how it really works??

As far as I know, it's only truly the child's once they turn 18. Until that time, the parents are free to spend it if they chose, so it would make sense that for tax purposes it belongs to the parents.

Tom

Info I received on this matter (some years ago though) is that a child cannot own an account on its own. You always need a parent/guardian of the child to stand as account holder until the child is no longer a minor.

My daughter has had an account since age 14 and been freely able to spend it with her own autobank card since then. I have oversight but not access to the account

Well I had a UK bank account at 11, a cheque book & bankers card at 13.
The money was mine & nobody but myself had any access to the account or statements.

I was working at 16 & had a UK ltd company before 18. I guess people grow up later now if this question is really being asked.

Of course I opened the account myself, it was not opened on my behalf with someone else's money.

Both my kids have a saving account. But it's impossible to take money off it, even for the parents.

The accounts belong to the kids, under their name, but we as the parents had to legally open it for them. It's blocked until they are 18, and we do not have to declare it under our own tax form. The kids will declare it on their first tax form when they're 18.

There's a legal age (depends on the bank) when minors can have a basic account with a basic debit card. The conditions are slighty different than for the adults though: no credit card, of course, impossible to go below zero on the account, and a limited daily limit.

Are you sure about this? I thought that in Switzerland the wealth of children has generally be declared on their parents tax return. It could be that certain accounts (eg blocked accounts) are extemped from tax. But I would expect, that they have to be declared all the same.

The bank won't snitch to the tax authorities, I suspect many people with multiple bank accounts don't bother either.

Tax dept is correct. I have to do the same for my children: I, as their parent, pay their wealth tax.

Whilst the child is a minor, the parents account for the wealth of the child

When the child reaches the age of majority (18 in CH), the (no longer) child is then responsible for lodging its own tax return.

The money at all times belongs to the child, they can spend as they see fit. But the parent is responsible for the tax matters.

This law prevents the parents bypassing the Swiss wealth tax by "lending" the child 10 million CHF and then "repaying" themselves the 10m the day before the child turns 18.

Whether you like the law or think the law is fair is not of relevance. It is the law. And must be obeyed.

And a certain amount of logic applies.

But that was the UK, under UK law.

We are in Switzerland and the question pertains to Swiss law, so stating the current laws in the UK, Australia, Pakistan, or the Outer Wangdaloos doesn't actually have any relevance to the conversation.

Yea but it is possible that the tax authorities will start asking questions if they see an account appearing out of nowwehre on a child's taxe return ( once they turn 18).

And here it is from the federal tax dept:

332 Kinder unter elterlicher Sorge
332.1 Das Kindsvermögen im Allgemeinen
Sowohl nach StHG als auch nach sämtlichen kantonalen Steuergesetzen wird das Vermögen von minderjährigen Kindern dem Inhaber der elterlichen Sorge zugerechnet (Art. 3 Abs. 3 StHG). Die selbständige Besteuerung tritt mit der Volljährigkeit ein.

Source:
http://www.google.ch/url?sa=t&rct=j&...ifJwTSbkPfIyhQ

No need to declare it ever....if it's big enough to be an issue.

The question was about children & bank accounts at no time did the OP state only 'Swiss bank account'. Children of expats will likely have several bank accounts in various jurisdictions. If you open an account 'in trust' for a child, you could choose any age 21, 25, 35.

Children can even be given a power of attorney, which specifically does not end on the parents death, which the child has not even signed....... Lots of rules & lots of exceptions. I don't think 'law' enters into it, it's down to your relationship with a bank.

Well, both the bank and the tax authorities told me I needn't declare it under my name. And the 35% isn't taken on the interests. The account is under my kids' names, and there's no way I can use it to laundry my money as I can't have access to the accounts other than to see how much there's in it.

I am quite surprised your allowed to see how much money is in the account, I thought Swiss Banking Secrecy would have prevented that.

We were told exactly the same thing by both the bank and the tax authorities.

If we want to see the account balance we have to go to the bank and provide them with our id card and they will make a printout for us. our son receives an annual statement from the bank.

All rules governing a child's property (who owns, who administers, for what can it be used, etc.):
http://www.admin.ch/ch/e/rs/210/a318.html and the following articles (all in English).

Most likely that is because it is a "Sparkonto" with less than CHF 200 interest being earned. If your child earns more than CHF 200 interest on a Sparkonto then the 35% will be deducted. If less than CHF 200 interest is being earned the tax authorities probably couldn't care less about the account.... (but you "should" still declare it...).

Something like this?