How do Junior ISAs work?
There are two types of Junior ISA and a child can have one or both of them:
Cash Junior ISA – a cash Junior ISA is similar to a bank or building society savings account, however, your child doesn’t have to pay tax on the interest they earn on their savings.
Stocks and Shares Junior ISA – with these Junior ISAs, investments are made through a variety of ways in stocks and shares on the financial markets – effectively the money you invest will be put into things like businesses, equities (shares) and commodities (products – such as coffee).
Who can pay in to a Junior ISA?
Anyone can pay into a Junior ISA, as long as it doesn’t exceed the tax-free allowance each year. For example: if you’re a parent investing on behalf of a son or daughter, grandparents, uncles and aunts or friends can all make deposits after the account has been opened.
Who can withdraw the money?
When the child named on the account reaches 18 years old they’ll be able to access the money invested for them.
Please bear in mind that the value of stocks and shares can fall as well as rise and the child could get back less than has been paid in.
The tax advantages of Junior ISA depend on you and your child's individual circumstances and the tax treatment of Junior ISAs may change in the future.
There’s an annual management charge of 1.5%.