UK:
Investing For Children
17 July 2015
UHY Hacker Young LLP
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There are now many options for investing on behalf of children,
but one stands out as an obvious starting point.
The Junior ISA (JISA) is very similar to its adult
counterpart, other than the maximum contribution limit, which in
2015/16 is £4,080. It offers the same tax freedoms – no
UK income tax on interest or dividends (although dividend tax
credits cannot be reclaimed) and no capital gains tax. Importantly,
the rules which can tax parents on the income of capital gifts to
their minor children do not apply to JISAs.
Since 6 April 2015 it has also been possible to transfer from
existing Child Trust Funds (CTFs) to JISAs, a move which can be
beneficial both in terms of broadening investment choice and
reducing costs.
The value of your investment can go down as well as up and you
may not get back the full amount you invested. Past performance is
not a reliable indicator of future performance. Investing in shares
should be regarded as a long-term investment and should fit in with
your overall attitude to risk and financial circumstances. The
value of tax reliefs depends on your individual circumstances. Tax
laws can change. The Financial Conduct Authority does not regulate
tax advice.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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