The chief executive of one of the UK’s oldest financial mutuals has welcomed the announcement in yesterday’s Budget that the annual subscription limit for Junior ISAs and Child Trust Funds will, for the 2020/21 tax year, be more than doubled to £9,000.
Commenting on the increase, Peter Green, chief executive of Healthy Investment, said, “This move represents a long-term vote of confidence in Junior ISAs on the part of the Government. It also means that JISAs can no longer be ignored as a mainstream financial planning tool either by parents, grandparents or financial advisers.
“From 6 April family members, and others, who want to save on behalf of the next generation will be able to invest £9,000 per year, per child. This could, over a period of years, represent a huge boost for those children when they come to take their first steps into the worlds of higher education, work and home ownership.”
Junior Individual Savings Accounts (JISAs), which convert to adult ISAs on the holder’s 18th birthday, can be invested in cash, stocks and shares or a combination of both. Interest, dividends and investment growth are free of income tax or capital gains tax.
The subscription limit for adult ISAs remains unchanged at £20,000 per individual, per year.
Greater Manchester-based Healthy Investment, which was founded in 1835 as The Independent Order of Rechabites, has its origins in the temperance movement that grew up during the Industrial Revolution. Today it provides ISAs, Investment Bonds, Junior ISAs, Child Trust Funds and savings plans to more than 110,000 members
"This could, over a period of years, represent a huge boost for those children when they come to take their first steps into the worlds of higher education, work and home ownership."