What is a Minor Trust Account?

If you’re looking for a way to give your child a head start on their financial future, a Minor Trust Account could be the way to go. A Minor Trust is an informal trust, which allows investments to be held ‘on behalf of’ or ‘in trust’ for someone else, known as the beneficiary, until they turn 18. Whether you’re a parent, grandparent, uncle or aunt, Minor Trust Accounts allow you to invest or hold assets on behalf of a child - or children - to help them get started on the right financial path.

How do I open a Minor Trust Account?

Minor Trust Accounts work in the same way as a normal CommSec Share Trading Account - they’re easy to access and manage, all via the CommSec website and mobile app. Plus, you can access all the same features as with a regular CommSec Share Trading Account. Learn how to open a Minor Trust Account below:

  1. Start a Minor Trust Account application.
  2. Follow the prompts to complete your Minor Trust Account application.
  3. You will be asked to select the account type you wish to open. Select Trust or Minor, then, when asked if you’d like to open a Minor Trust Account, select Yes. 
  4. Once your application has been successfully processed, you’ll receive an email with your account details and Client ID. This account will be CHESS-sponsored with its own HIN. If there are any issues with your application, we’ll contact you.

Once your child or loved one turns 18, you can opt to transfer the shares in the trust to their own Share Trading Account using an Off Market Transfer (OMT). You should also consider any potential changes to your tax obligations and any fees associated with the share transfer. 

There may be tax implications associated with opening a Minor Trust Account. Please seek professional tax advice before making a decision.

Benefits of a Minor Trust Account

Kick-start a minor’s financial future

Minor Trust Accounts can help set your kids up for a more secure financial future. You can either open an individual Minor Trust Account for each child or open one Minor trust Account and list each child as a separate beneficiary.

One account for each child

There is no limit to how many Minor Trust Accounts one person can hold as a trustee. As such, you can manage separate Minor Trust Accounts for multiple children at the same time, each account with its own Holder Identification Number (HIN).

Foster their financial literacy

By actively involving your child in their investment journey, you can help foster early financial literacy and habits to help them build a positive relationship with money in the future.

Your questions, answered

A Minor Trust Account must be opened by an adult, who can be a parent, guardian, grandparent or other family member over 18 years of age. A child cannot create an account on their own, nor can they access or trade through the account themselves.  

The trustee of a Minor Trust Account can choose to transfer the shares out of the Minor Trust Account and into an account in the beneficiary’s own name once the beneficiary turns 18, or at any age thereafter. This can be done through an Off Market Transfer, which involves a transfer fee. You should also consider any potential changes to your tax obligations before doing so. 

While there are fees associated with buying and selling stocks using your Minor Trust Account, there are no start-up fees or ongoing costs related to opening a CommSec Minor Trust Account. Please see CommSec’s rates & fees or our Financial Services Guide (FSG) for more information.

Once your buy order is partially or fully executed with CommSec, settlement will take place two (2) business days after its execution (T+2).
To pay for your shares:

  • We will automatically direct debit from your Commonwealth Direct Investment Account (CDIA) on T+2. To view the details of your CDIA account, select Portfolio > Accounts after you have logged into your CommSec account.

When you have bought and sold shares on the same day and the next trading day, your payment may be partially or wholly offset. For more information refer to the New Client Guide.

The ‘legal ownership’ of the shares held in the Minor Trust Account remains with the trustee (e.g., parent) until they choose to transfer them to the child’s own individual account after they turn 18.   

Minor Trust Accounts may have tax implications for the trustee. You may wish to consult a tax professional for advice before proceeding.

CommSec does not offer recurring or “auto investments” for Minor Trust Accounts. These types of investments can be made through our CommSec Pocket offering; however, it is not currently available for Minor Trust Accounts.  The minimum amount needed for the initial purchase of any particular shareholding is $500.  

Want to learn more about how you can invest on behalf of your kids? Visit our Minor Trust Account FAQs for more information.

Important information: 

A CommSec Minor Trust Account is an investment account opened and operated by an adult for a child under the age of 18. This is operated by, and in the name of, the individual adult with an account designation that refers to the child. It is a common way of describing this account type in the industry. Essentially, the adult acts ‘as the trustee for’ the child who is a ‘beneficiary’. This does not necessarily mean that there is a legal or formal trust in place.

Disclaimer:

The information on this page has been prepared without taking into account your objectives, financial situation, taxation position or needs. For this reason, any individual should, before acting on this information, consider the appropriateness of the information for your circumstances and, if necessary, seek appropriate professional advice.  

The Commonwealth Direct Investment Account (CDIA) is issued by Commonwealth Bank of Australia ABN 48 123 123 124 AFSL 234945. This product is administered by Commonwealth Securities Limited ABN 60 067 254 399 AFSL 238814 (CommSec), a wholly owned but non-guaranteed subsidiary of the Commonwealth Bank of Australia. CommSec is a Market Participant of ASX Limited and Cboe Australia Pty Limited, a Clearing Participant of ASX Clear Pty Limited and a Settlement Participant of ASX Settlement Pty Limited. The target market for this product can be found within the product’s Target Market Determination, available at commbank.com.au/tmd. 

To operate a CommSec Pocket account, you’ll need an eligible CommBank transaction account. You can view the CommSec Pocket Terms and Conditions and the CommSec Trading Terms and Conditions, CommBank Transaction Savings and Investment Account Terms and Conditions, Best Execution Statement, Financial Services Guide and should consider them before making any decision about these products and services.

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© Commonwealth Securities Limited ABN 60 067 254 399 AFSL 238814 (CommSec) is a wholly owned but non-guaranteed subsidiary of the Commonwealth Bank of Australia ABN 48 123 123 124 AFSL 234945. CommSec is a Market Participant of ASX Limited and Cboe Australia Pty Limited, a Clearing Participant of ASX Clear Pty Limited and a Settlement Participant of ASX Settlement Pty Limited.

The information on this page has been prepared without taking into account your objectives, financial situation or needs. For this reason, any individual should, before acting on this information, consider the appropriateness of the information, having regards to their objectives, financial situation or needs, and, if necessary, seek appropriate professional advice.

CommSec does not give any representation or warranty as to the accuracy, reliability or completeness of any content on this page, including any third party sourced data, nor does it accept liability for any errors or omissions.

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