It’s never too early to start thinking about saving for the future. A Junior Individual Savings Account (‘JISA’) gives children the opportunity to start saving early – via cash, stocks and shares, or a combination of the two – within a tax-free wrapper. The maximum amount that may be paid into a JISA in the 2023/24 tax year is £9,000. This can be invested into a cash JISA or a stocks and shares JISA, or allocated between the two.
According to HMRC, £1 billion was subscribed to JISAs in 2020/21. Until relatively recently, children born between 1 September 2002 and 2 January 2011 were previously only eligible for a Child Trust Fund (CTF). However, following changes introduced in April 2015, CTF savings can be transferred into a JISA instead.
In order to qualify for a JISA, the child has to live in the UK and be aged under 18. A child can hold either type of JISA or can mix and match between the two. JISAs may be switched from cash to stocks and shares, and back again. However, the child can only have one cash JISA and one stocks and shares JISA during their childhood, although those two components can be held with different providers. The JISA savings belong to the child, who can take control of the JISA once they are 16 but – with a few very limited exceptions – cannot withdraw the money until they are 18.
