Hi @MalikHenry . Thanks for the question!
The income earned on the funds in the UGMA would be treated as income to your grandchild.
If the grandchild's income exceeds the filing threshold they would be required to file and if there is any kiddie tax, it is calculated on the child's tax return.
The following TurboTax article provides some great information on the kiddie tax.
https://ttlc.intuit.com/turbotax-support/en-us/help-article/small-business-processes/2021-kiddie-tax...
I hope that I have answered your question MalikHenry. Please reach out if we can be of further assistance!
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