Junior Isas

Junior ISA’s…ISA’s for Children

Junior IsasJunior ISAs are expected to be the new tax-free savings and investment accounts for children. Expected to launch in late-2011, Junior ISAs will replace Child Trust Funds. If you’re interested in saving for a child’s future, they could be a great option when they become available.

What is a Junior ISA?

The Junior ISA is a new tax efficient account designed for adults to save and invest on behalf of children.

Who is eligible for a Junior ISA?

Any child resident in the UK who wasn’t eligible for a Child Trust Fund (CTF):

  • Children born on or after 3rd January 2011
  • Under 18’s born before September 2002

Any child born between 1st September 2002 and 3rd January 2011 that didn’t qualify for a Child Trust Fund will also be eligible for a Junior ISA.

The Family Investments Junior ISA will only be available to children under the age of 16, who didn’t qualify for a CTF.

What are the main features of the Junior ISA?

  • The child enjoys an initial limit of £3,600 per year across both types of account
  • Proceeds of the account are held in the child’s name
  • Tax efficient like an adult ISA
  • Money in the account cannot be withdrawn by the parents as it is designed for the child’s future
  • The parent manages the account on the behalf of a child
  • At age 18 the account is converted into an adult ISA and the young adult can access their funds.

Are there different types of Junior ISA accounts available?

Yes. Like adult ISAs, there are two different types of Junior ISA:

  • A cash Junior ISA – which will earn interest like a savings account from a bank or building society
  • A stocks and shares Junior ISA – which will invest in stocks and shares

You can take out both a cash Junior ISA and a stocks and shares Junior ISA, with different providers (or the same provider if they offer different products), at the same time if you choose.

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