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STRICTLY EMBARGOED UNTIL 00:01 ON TUESDAY 01 NOVEMBER 2011 - Junior ISAs launch today to help parents save for their children’s future
STRICTLY EMBARGOED
UNTIL 00:01 ON TUESDAY 01 NOVEMBER 2011
Parents will be able to open a Junior ISA account for their
children from today at a range of high street institutions,
Financial Secretary to the Treasury Mark Hoban has confirmed.
Around six million children will immediately be eligible for a
Junior ISA, with a further 800,000 children benefitting each
following year. All children under 18 who are UK residents and do
not have a Child Trust Fund (CTF) will be eligible for a Junior ISA.
Mr Hoban confirmed that the limit for Junior ISAs would be set at £3,600. To ensure that children with a CTF are not disadvantaged he also confirmed that, from today, the CTF savings limit will treble from £1,200 to £3,600, aligning it with the new Junior ISA limit.
Funds in a Junior ISA will be locked-in until age 18 and roll over into an adult ISA on maturity, meaning that the accounts will help to foster a long-term savings habit among young people.
Mark Hoban said:
"The launch of Junior ISAs is a clear demonstration of the Government’s commitment to encourage saving for children. Junior ISAs will be open to all parents, regardless of income. This, together with changes made to Child Trust Funds, mean that parents can save up to £3,600 per year for their child.”
Notes for Editors
1. In October 2010 the Financial Secretary announced that the
Government would create a new tax-free children’s savings account,
or ‘Junior ISAs’. The original press notice can be found here: http://www.hm-treasury.gov.uk/press_57_10.htm
2. In March 2011, Mr Hoban set out further proposals for
consultation on the Government’s plans for Junior ISAs. This
consultation closed in May 2011. Further information can be found
here: http://www.hm-treasury.gov.uk/press_35_11.htm
3. Junior ISAs will be available from 1 November 2011.
Children will be able to have one cash and one stocks and shares
Junior ISA at any time, with an overarching annual contribution
limit of £3,600. This is an increase from the previously proposed
limit of £3,000.
4. Junior ISAs will be offered by high-street
banks, building societies, and any other providers that currently
offer standard ISAs and CTF accounts.
5. Funds in Junior ISAs
will be ‘locked in’ until the child is 18, and the accounts will
then, by default, become adult ISAs.
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