Investing in your child's future through a Junior ISA

What is a Junior Investment ISA?

A Junior ISA (JISA) is a tax efficient way to invest in your child’s future as there’s no UK income tax or capital gains tax payable on any returns. As such, the tax advantages and flexibility they provide make them a savvy option for parents who want to invest in their child’s future.

In the 2024 to 2025 tax year, the maximum amount that can be contributed to a Junior ISA is £9,000, and this can be done by parents, grandparents, friends, or family.

Money held in a Junior ISA is locked in until the child reaches 18, after which it converts into an adult ISA. The child then has full access to the funds.

Gifts from Grandparents

Although JISAs must be established by a parent or legal guardian, they can be used if a grandparent wanted to give a lump sum to their grandchildren. Instead of giving cash gifts, it’s a smart way to invest in your child’s future.  Gifting money in this way is also a great opportunity for those with estate planning needs who want to see their wealth passed on effectively to younger generations.

Paying for big ticket items

There are a few big ticket items that a child needs when they reach 18.  Funds for university, a new car, a gap year to travel and see the world. Investing a little each month into a Junior ISA, means that money will be there for them to access at a time when they might need it the most.

Teaches your child about the benefits of saving

Educating children on finance and getting them engaged in monitoring their savings can help them make better decisions later on. It will also help them see the value of long-term saving and investment.

If you’re looking to open a Junior ISA for your children or think about tax efficient ways you can invest in your child’s future, we’re here to help and provide you with expert advice. Book a call with our Derby-based financial advisers here. 

The value of an ISA with St. James’s Place will be directly linked to the performance of the funds you select and the value can therefore go down as well as up. You may get back less than you invested.

The levels and bases of taxation, and reliefs from taxation, can change at any time. The value of any tax relief depends on individual circumstances.