Published On: Fri, Oct 4th, 2019

What is a Junior ISA? Annual limit explained | Personal Finance | Finance


An ISA (Individual Savings Account) is a type of account which a person can put money into – up to a certain amount each tax year. In the 2019 to 2020 tax year, savers can deposit up to £20,000 in ISAs. They do not pay tax on interest on cash in an ISA, nor income or capital gains from investments in an ISA. A Junior ISA stands for Junior Individuals Savings Account and these are long-term, tax-free savings accounts for children.

The savings limit for Junior ISAs is £4,368 in the 2019 to 2020 tax year.

In order to get a Junior ISA, the child must be both under the age of 18 and living in the UK.

A child living outside of the UK can get a Junior ISA, provided their parent or guardian is a Crown servant and they’re dependent on them for care.

How do Junior ISAs work?

There are two types of Junior ISA, with one being a cash Junior ISA.

In this type of account, tax is not required to be paid on interest on the cash that is saved.

The other type is a stocks and shares Junior ISA.

An example of this is where the cash is invested and the saver will not pay tax on the capital growth or any dividends they receive.

A child can have one or both types of Junior ISA.

Who can open a Junior ISA?

Parents or guardians with parental responsibility can open a Junior ISA and manage the account.



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