What is evidence of beneficial ownership?
Evidence of beneficial ownership includes statements, correspondence, and other documentation that shows that the money used for investing came from the child, or that it was gifted to the child.
It can also include records of who made investment decisions, and where any income was paid to.
What it needs to capture
Evidence of beneficial ownership should be contemporaneous, which means that it should be created and maintained as the transaction or activity happens.
Evidence can be anything that captures:
where the funds to acquire the investment came from
who made the investment decisions, and
where any income earned from the investment was paid to.
Examples of evidence
Separate bank account held in the kid’s name (with the parent as trustee) which can receive gifts, dividends, or income.
Bank account statements recording the nature of funds in/out the child’s bank account.
Dividend statements or reinvestment plans.
Gift documentation.
Correspondence (including marketing material) from Sharesies confirming the account is for the benefit of the child.
Records showing that all income, dividends, and/or sale proceeds are accumulated or spent for the child’s benefit only (and not spent on items like school fees or family expenses which a parent is obliged to pay for).
Shares, dividends, and sale proceeds are kept separate from the parent’s.
Will provisions recognising the kid’s ownership of the investment assets and related income.
Income tax returns filed in the child’s name, declaring any investment income and/or sale proceeds.