Junior Individual Savings Accounts (ISAs) are long-term, tax-free saving accounts for children.
Who can get a Junior ISA
• the child must be under 18
• living in the UK
If your child lives outside the UK
Your child can only get a Junior ISA if both the following apply:
- you are a Crown servant (in the UK’s armed forces, diplomatic service or overseas civil service, for example)
- they depend on you for care.
How Junior ISAs work
There are 2 types of Junior ISA:
- a cash Junior ISA – you will not pay tax on interest on the cash you save, or
- a stocks and shares Junior ISA – your cash is invested and you will not pay tax on any capital growth or dividends you receive.
Your child can have one or both types of Junior ISA. Parents or guardians who have parental responsibility can open a Junior ISA and manage the account, but the money belongs to the child.
A child can take control of the account when they reach the age of 16 but cannot withdraw the money until they reach the age of 18.
Add money to an account
Anyone can pay money into a Junior ISA, but the total amount paid in cannot go over £9,000 in the 2020 to 2021 tax year.
You can obtain further information about accessing a Junior Trust Fund here.
Junior ISA for ‘Looked After Children’
Children looked after for 12 months or more and not eligible for a Child Trust Fund are entitled to a £200 payment from the government into a Junior Individual Savings Account.
• child must be under 18
• lives in the UK
• been continuously in care or ‘looked after’ for at least 12 months
You can obtain further information about Junior ISA’s for looked after children here.
If you already have a Child Trust Fund
A Child Trust Fund (CTF) is a long-term tax-free savings account for children.
You can continue to add up to £9,000 per year (during 2020/21 – this may change each year) to the Child Trust Fund. As with the Junior ISA, you will not have access to the money in the fund. It belongs to the child and they can only withdraw the money in the account when the reach the age of 18. They can take control of the account when they are 16.
You cannot have a Junior ISA as well as a Child Trust Fund. If you want to open a Junior ISA, you will need to ask the provider to transfer the trust fund into it.
The Child Trust Fund scheme is now closed. If you do not have a Child Trust Fund you will need to open a Junior ISA.
Both the Junior ISA and Child Trust fund will not affect any benefits or tax credits you receive.
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