What is a Junior ISA (JISA)?

A Junior Individual Savings Account, now commonly known as a Junior ISA or JISA, is a long-term, savings or investment account available to children under the age of 18 in the United Kingdom.

Junior ISAs were introduced in 2011 to replace the old Child Trust Funds for children born after 2 January 2011, and were designed to encourage families to save early for their children’s future.

One of the main advantages of a Junior ISA is that any money held within the account grows free from duties including income tax, capital gains tax and dividend tax. This makes it a highly tax-efficient way of saving or investing for future expenses such as university tuition fees, a first home or general financial support in early adulthood.

Importantly though, while the account is opened and managed by a parent or guardian, the money legally belongs to the child. This ensures that savings are preserved solely for the child’s benefit and cannot be accessed by adults for other purposes. When the child reaches the age of 18, the Junior ISA automatically converts into an adult ISA, and full control of the account passes to the child.

For the 2025 to 2026 tax year, the government has set the Junior ISA annual allowance at £9,000. This is the maximum amount that can be paid into a child’s Junior ISAs during the tax year, regardless of how many people contribute.

Eligibility and residency rules

To qualify for a Junior ISA, the two most important criteria are that a child must be under the age of 18 and living in the United Kingdom. These two conditions must be met for an account to be opened.

There are limited exceptions for children who live outside the UK; for example if the parent or guardian is a Crown servant, such as a member of the armed forces, diplomatic service or overseas civil service, and the child depends on them for care.

A child cannot hold both a Junior ISA and a Child Trust Fund at the same time. If a Child Trust Fund already exists, it must be transferred into a Junior ISA before any new contributions can be made. This transfer is arranged through the Junior ISA provider, ensuring the child continues to benefit from tax-free savings without holding two similar accounts simultaneously.

Types of Junior ISA

There are two types of Junior ISA available: Cash Junior ISAs and Stocks and Shares Junior ISAs. A child may hold one of each type at the same time, but not more than one of each.

A Cash Junior ISA operates in much the same way as a traditional savings account. Money deposited into the account earns interest, and that interest is completely tax free.* The value of the savings does not fluctuate, which makes this option lower risk and particularly suitable for families who prefer certainty or perhaps for children who are closer to turning 18 and have near-term needs for the money.

A Stocks and Shares Junior ISA, by contrast, allows money to be invested in assets including shares, bonds, and investment funds. Any capital growth or dividends generated by these investments are also free from tax.*

While the value of investments can rise and fall, this type of Junior ISA generally offers far greater potential for long-term growth and is often considered suitable for younger children who have many years before they will need access to the funds, and can therefore weather any short-term volatility.

Contributions, allowances, and transfers

Anyone is allowed to pay money into a Junior ISA, including parents, grandparents, relatives and friends. However, the total amount paid into the account across all contributors must not exceed the annual allowance of £9,000 for the tax year, which runs from 6 April to 5 April the next year. This allowance applies to both cash and Stocks and Shares Junior ISAs combined and cannot be carried forward to future tax years if it’s not fully used.

For example, if £2,000 is paid into a child’s Cash Junior ISA during a tax year, only £7,000 may be contributed to their Stocks and Shares Junior ISA in that same year. Transfers are permitted between a child’s own Junior ISAs, as well as from a Child Trust Fund into a Junior ISA.

However, it’s not possible to transfer money between a Junior ISA and an adult ISA. If a child moves abroad, contributions can still be made to their Junior ISA, provided the account remains open.

Ownership, management, and access to funds

Although a Junior ISA is opened by a parent or guardian, all the money in the account legally belongs to the child from the moment it is deposited, with the adult who opens the account known as the ‘registered contact’ and only responsible for managing it.

This includes making decisions about the account provider, switching between cash and stocks and shares accounts, and reporting any changes of circumstances to the provider.

Withdrawals from a Junior ISA are not permitted until the child turns 18, except in very limited circumstances. From the age of 16, the child is allowed to become the registered contact and take over management of the account, although they still cannot access the money.

When the child reaches 18, the Junior ISA automatically converts into an adult ISA, and they gain full access to the funds while retaining the tax-free benefits.

For these reasons, it’s important to consider the legal consequences; if a child decides to spend the money frivolously at age 18, there is nothing stopping them from doing so. This makes age-appropriate financial education extremely important, particularly as they come closer to gaining access to their funds.

If the child lacks the mental capacity to manage their account at age 18, a parent, close relative or friend must apply for a financial deputyship order. This application is made to the Court of Protection in England and Wales, the Office of the Public Guardian in Scotland or the Office of Care and Protection in Northern Ireland.

This legal arrangement allows someone else to manage the account or withdraw funds on the child’s behalf.

Adult ISAs: How they differ from Junior ISAs

An adult Individual Savings Account (ISA) is similar to a Junior ISA in that it is also a tax-free savings or investment account available to UK residents, but is aimed at adults aged 18 and over.

However, there are important differences between the two.

The most significant difference is access. With an adult ISA, the account holder can withdraw money at any time, whereas funds in a Junior ISA are locked in until the child turns 18 (except in exceptional circumstances). Adult ISAs are designed for flexibility, allowing savers to use their money whenever they need it.

Another key difference is the annual allowance. Adult ISAs have a much higher allowance than Junior ISAs, set separately by the government each tax year. Currently set at £20,000, this allowance applies across several types of adult ISAs, including Cash ISAs, Stocks and Shares ISAs, Innovative Finance ISAs and Lifetime ISAs.

Ownership and control also differ. An adult ISA is opened, managed and owned entirely by the individual, while a Junior ISA is managed by a parent or guardian until the child reaches adulthood.

Again, when a child turns 18, their Junior ISA automatically converts into an adult ISA, giving them full access while keeping the same tax-free benefits.

Terminal illness, death, and special circumstances

In cases where a child is terminally ill, it’s possible to withdraw money from a Junior ISA before the age of 18. A terminal illness is defined as a condition that is expected to worsen and result in death within six months. The time allowed to access the funds varies depending on where the child lives: six months in England and Wales, twelve months in Northern Ireland and no time limit in Scotland.

The child’s registered contact must complete a terminal illness early access form and notify HM Revenue and Customs, who will confirm whether early withdrawal is permitted.

If a child dies, the money held in their Junior ISAs becomes part of their estate and is paid to the person who inherits it, which is usually a parent. HMRC does not need to be contacted in this situation, but the account provider must be informed so that the accounts can be closed. The provider may request documentation, such as a copy of the death certificate before releasing the funds.

Choosing a provider and long-term value

Junior ISAs are available from a wide range of providers, including banks, building societies, credit unions, and trading platforms. When choosing a provider, it’s important to consider fees and charges for investment accounts, the range of investment options available and the quality of customer support.

Over the long term, a well-managed Junior ISA can make a significant difference to a young person’s financial future. In addition to providing tax-free growth, it can also help children develop an understanding of saving and investing as they approach adulthood.

While funds cannot be accessed before age 18, the structure of a Junior ISA ensures that money is protected for the child’s benefit, making it one of the most effective tools available for long-term savings in the UK.

Junior ISAs summed up

• A Junior ISA (JISA) is a long-term, tax-free savings or investment account for UK children under 18, designed to help families save for a child’s future
• Money in a Junior ISA grows free from income tax, capital gains tax and dividend tax, with an annual contribution limit of £9,000 for the tax year, shared across all contributors
• Although opened and managed by a parent or guardian, the money legally belongs to the child and cannot be withdrawn until age 18, when the account automatically converts into an adult ISA and full control passes to them
• There are two types; cash Junior ISAs and Stocks and Shares Junior ISAs (higher growth potential with investment risk), which can be held together and are suited to different time horizons and risk preferences

*Tax rules vary by jurisdiction. ISAs only apply to certain investors. Please check local laws.