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eckie(Initiate)Initiate
21 Feb 2026

My child just turned 16. I have been giving him $1000 in shares for each birthday since he was 7 in [external link removed by moderator] under my name. I plan to "transfer" the shares to him in his own account soon by selling and repurchasing later (still cheaper than to pay the transfer fees!). Naturally i will incur CGT, and that is all good.


So now, when i transfer the proceeds to his bank account, he will have $20k. He will derive interest income while the fund sits there. Question is.. is that his interest income to report (he has his own TFN) or do i include in mine?


I was here - https://www.ato.gov.au/individuals-and-families/investments-and-assets/investing-in-bank-accounts-and-income-bonds/children-s-savings-accounts#ato-Whodeclaresinterest - so considering the points there:


  • who provides the money - ME
  • who decides how the money is spent - HIM


So it's 50-50. What happens now?

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128 views
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Most helpful reply

NikkiATO(Community Moderator)Community Moderator
23 Feb 2026

Hi @eckie,


The interest income belongs to your son, and he’ll need to report it in his own tax return.


Once you transfer the money into his bank account, he owns and controls those funds. Who declares the interest based on who owns the money and who decides how it's spent. You originally provided the money, but when you pass the proceeds to him and he controls the account, ownership shifts to him.


Since he owns the funds and chooses how they’re used, the interest is his income. He should quote his own TFN to the bank so tax isn’t withheld, and he should declare the interest in his return.


This is different from the shares. For shares, we look at who paid for them, who makes the investment decisions, and who benefits from the dividends. For bank accounts, the focus is who owns or uses the money now, not where it originally came from.


Since he’s 16 and quoting his TFN, the bank won’t withhold tax. He’ll only need to lodge a tax return if his total taxable income for the year goes over the normal tax‑free threshold or if tax is withheld.

All replies

Most helpful reply

NikkiATO(Community Moderator)Community Moderator
23 Feb 2026

Hi @eckie,


The interest income belongs to your son, and he’ll need to report it in his own tax return.


Once you transfer the money into his bank account, he owns and controls those funds. Who declares the interest based on who owns the money and who decides how it's spent. You originally provided the money, but when you pass the proceeds to him and he controls the account, ownership shifts to him.


Since he owns the funds and chooses how they’re used, the interest is his income. He should quote his own TFN to the bank so tax isn’t withheld, and he should declare the interest in his return.


This is different from the shares. For shares, we look at who paid for them, who makes the investment decisions, and who benefits from the dividends. For bank accounts, the focus is who owns or uses the money now, not where it originally came from.


Since he’s 16 and quoting his TFN, the bank won’t withhold tax. He’ll only need to lodge a tax return if his total taxable income for the year goes over the normal tax‑free threshold or if tax is withheld.

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