Junior ISAs to launch on 1st November

Tax-free children’s savings accounts, known as ‘Junior ISAs’, will be available from 1 November 2011. The new accounts will offer parents a tax-free way to save for their Junior ISA'schildren’s future.

 Junior ISAs are a tax-free savings account for children, which have been introduced to replace the Child Trust Fund (CTF) accounts.  CTFs have been closed to children born on or after 3 January 2011, and unlike CTFs the Government will not make any payments into the new Junior ISAs.

 The key features of the Junior ISA are:

  • children living in the UK who do not have a Child Trust Fund account will be able to have a Junior ISA
  • people will be able to put money into a cash account or ‘stocks and shares’ account
  • each child will be able to have one cash and one ‘stocks and shares’ Junior ISA at any one time
  • there will be a total yearly limit of £3,600 for all payments into these accounts
  • accounts will automatically become “normal” ISAs when the child is 18

 As with Child Trust Funds, the following will apply to Junior ISAs:

  • the accounts will belong to the child, and they are not able to get the money out until they are 18
  • the child can become responsible for the account when they are 16
  • any money the accounts make will be tax free
  • a range of banks, building societies, credit unions and friendly societies, as well as stockbrokers and fund managers, will offer Junior ISA accounts

 The first Junior ISA accounts will be available from 1 November 2011.

 If you would like to discuss the introduction of Junior ISAs, or indeed any aspect of saving for children and grandchildren (including for school and university fees)  please call Gareth on 01792 410100, or email him on retirement@bevanbuckland.co.uk. 

 The above information is taken from the Government’s “DirectGov” website (http://www.direct.gov.uk/), and is correct as at 30th September 2011.  The details are supplied for information purposes only, and do not constitute financial advice.  If you wish to consider whether investments such as these are suitable for your particular circumstances please contact Bevan & Buckland or consult another suitably qualified adviser.

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