Smith & Williamson will offer a Junior ISA, the new tax-efficient savings account for children, from 1 November 2011.
Junior ISAs are the latest savings initiative from the Government to promote investing for children. Junior ISAs will replace child trust funds (CTFs) and will launch on 1 November 2011.
The subscription limit for the Junior ISA in the first two years has been set at £3,600. The limit for CTFs will also be increased to £3,600 in November 2011. Junior ISAs will allow parents, family members and friends to make savings on behalf of the child up to the annual subscription limit.
Who is eligible for a Junior ISA?
Junior ISAs will be available to all children resident in the UK who do not already have a CTF and who were born:
- on or after 3 January 2011; or
- before September 2002 and are under 18; or
- between these dates but do not already have a CTF.
Can anyone open a Junior ISA?
A parent or someone with parental responsibility can open a Junior ISA on behalf of an eligible child. It is possible for eligible children aged 16 or over to open a Junior ISA themselves.
What are the main features of the Smith & Williamson Junior ISA?
- Smith & Williamson will only offer the stocks and shares Junior ISA.
- It is a tax-efficient savings wrapper, similar to an ISA in terms of tax relief.
- Parents, family and friends can contribute up to £3,600 a year per child.
- Withdrawals cannot be made until the child's 18th birthday, when the Junior ISA is converted to an 'adult' ISA (except in exceptional circumstances).
- The £3,600 subscription limit will be adjusted in line with the Consumer Prices Index from 6 April 2013.
When will it be available?
Smith & Williamson will offer the Junior ISA from 1 November 2011.
Risk warning
The value of investments can go down as well as up and investors may not receive back the original amount invested. Tax advantages depend on individual circumstances and tax treatment may change in the future.
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.
