Investment Junior ISA
The simple and flexible way to give your child a solid financial start in life from as little as £10 a month
- Available to all children under the age of 18
- Potential for tax-free growth through bonuses
- Top-ups can be made by anyone
- Guarantee after five years for peace of mind
About this policy
We all want to give our child the very best start in life, and with our Junior Investment ISA (JISA) you could do just that.
Our JISA gives you the ability to save tax-free, with plans starting from £10 a month or a single lump sum of £100. You can save up to £9,000 in the current tax year and once opened, top ups can be made by anyone at any time within the annual limit.
What are they?
JISAs were first introduced by the government in November 2011, as a way for parents or guardians to set up a long-term tax-free savings account for their child(ren).
There are two types of JISA available, a stocks and shares JISA and a cash JISA. We offer a stocks and shares JISA in the form of a with-profits insurance policy, which is designed for the medium to long-term and matures on the child's 18th birthday. We refer to our our JISA as an Investment JISA because of the way we invest (in our with-profits fund) - which includes property, bonds and fixed interest as well as the stock market. The fund is managed to provide a low-medium risk investment.
Who are they for?
Any child under the age of 18 who is a UK resident can have a JISA opened for them by a parent or guardian.
Children born between 1st September 2002 and 2nd January 2011 may have a Child Trust Fund (a long-term tax-free savings account for children set up by the government). A child cannot have both a Child Trust Fund (CTF) or a JISA, however a CTF can be transferred to a JISA.
Unsure if your child has a CTF? Visit the gov.uk website for further information.
More information can also be found in our FAQs.
Why open one?
Our Investment Junior ISA is a simple and affordable way to save (tax-free) for a child's financial future. Save towards their first car, house deposit or university fees - the choice is yours.
Frequently asked questions
Our most commonly asked questions surrounding the Junior Investment ISA can be found below.
The JISA will mature when the child reaches 18 years of age. At this time the child can withdraw the funds or rollover the investment in to an adult ISA in their own name. Withdrawals are not allowed at any time before age 18.
Every child can hold both a stocks and shares JISA and a cash JISA at any one time with the same or different product providers, providing the overall investment allowance is not exceeded (see below).
The government sets the investment limits and the current allowance for the tax year which runs from 6 April to 5 April is £9,000 or £750 per month. This amount can be split between a stocks & shares JISA and a cash JISA, providing the overall limit is not exceeded in the tax year (6 April to 5 April). The minimum in the Sheffield Mutual Investment JISA is £10 per month or a single lump sum of £100.
Yes, providing you don’t exceed the maximum annual investment allowance (above) you can add to the JISA at any time during the tax year. If you are not subscribing on a monthly basis by direct debit the minimum additional investment is £50. Any person can subscribe to the child’s JISA - including parents, grandparents, family members and friends. All subscriptions will be classed as gifts to the child, which means that once premiums have been added, under normal circumstances (except on early death or the diagnosis of a terminal illness), the funds cannot be withdrawn until the child reaches the age of 18.
The child must be a resident in the UK when the JISA is opened (or a dependant of a crown servant living overseas). Although the funds belong to the child (the ‘policyholder’) at all times, the policy must be opened and operated by a 'registered contact' (someone who will manage the plan) until the child reaches at least 16 years of age. The registered contact will be the person with parental responsibility for the child, with the child able to take over as their plan, if they wish, at age 16.
Depending upon the performance of our investments, we will declare a bonus rate annually in March and this will be applied to the JISA at the end of the tax year. The amount of bonus credited to the policy will depend on the amount invested (known as policy premiums) and, as bonuses are calculated daily (after deducting charges) on a compound basis and added monthly (net of charges), the length of time the policy has been running. The registered contact will receive a statement during April each year setting out the amount of bonus and present value of the JISA. There is also the possibility of a final bonus on maturity of the JISA. Bonuses are not guaranteed.
We will deduct 1.5% of the value of the JISA policy fund each year to cover administration and expenses. The annual charge is normally deducted from the declared annual bonus amount before it is added to the policy. However, it would be deducted from the policy fund should the bonus amount be less than the annual charge.
Yes, you can transfer previous years’ JISA subscriptions in whole or in part from another provider to us, without it affecting the annual investment allowance. Current tax years’ JISA subscriptions must be transferred in full. Transfers can be made either way (i.e. cash to stocks and shares or stocks & shares to cash) and are subject to the child not having more than one JISA of each type at the end of the transfer process. This means that part transfers can only be made to another type, for example, part cash JISA transferred to a stocks & shares JISA. The minimum investment is £100, so if your transfer amount is less, you will need to make it up to £100.
Yes, those with a CTF may transfer to a JISA. This must be the whole amount as partial transfers are not allowed. This type of transfer will not count towards the child’s JISA allowance. Don't worry about contacting the current provider, we'll take care of everything for you.
A CTF may be transferred even if, at the time of the transfer, the child would not meet the normal UK residency conditions for a JISA.
Yes, you can stop or vary the level of payments at any time. However, we retain the right to terminate the policy in circumstances where you have not invested the minimum initial premium of £100 for single premium JISAs or £10 per month for 12 months for regular premium JISAs.
Just like adult ISAs, no tax is payable on any of the income or capital gains a child receives from JISA savings and investments. In addition, no tax is payable by a subscriber to the policy on any income or gains generated by the JISA, even where that income exceeds the £100 limit which normally applies to gifts from parents. This is based on current tax legislation, which may vary in the future.
We invest in a range of different assets with the aim of providing a higher return in the medium to long-term than is achievable with a bank or building society account. Sheffield Mutual's with-profits fund is managed to provide a low to medium risk investment, appealing to anyone with a more cautious approach to investment. Our investments include property, shares of UK companies, government gilts, corporate bonds, commercial mortgages and cash.
However, should you wish to withdraw (after maturity) or transfer funds from the JISA during adverse investment conditions, the Society may apply a Market Value Reduction to the policy fund, which could in some circumstances, result in the child receiving back less than you paid in. Therefore, the amount you receive on repayment is not guaranteed and you should only invest in an Investment JISA if you are prepared to take some risk to increase the potential returns.
You'll be pleased to know that we seek to adopt an ethical approach to investing and it is our policy not to invest knowingly or directly in industries relating to armaments, tobacco, gambling or pornography.
In the unfortunate event of early death or the diagnosis of a terminal illness, we will pay 101% of the policy value to the child’s estate or personal representative. Closure of the JISA in relation to a terminal illness must be agreed by HM Revenue & Customs. Bonus will be paid tax-free up until the date of death.
In the unfortunate event of the death of the parent/guardian, we will need to see the original (or certified copy) death certificate. Another person with parental responsibility for the child (or the child if aged 16 or over) should then apply to become the person responsible for the plan.
Provided the monies come from a UK bank account, you and your family and friends can continue to pay money in, subject to the JISA limits.
Need some further assistance? Our team would be more than happy to provide you with factual information about our products and services, so you can make your own decision about how to proceed. However, we are unable to give any financial advice or recommendations on the suitability of our products. If you are unsure, you should seek advice from a qualified financial adviser, which may incur a fee.
Need help with some of the language we've used? Click here for our Jargon Buster.
An amount we will add to your policy linked to how well the with-profits fund has performed. These can be annual bonuses or a final bonus, added when your ISA is closed or transferred.
A tax-free deposit account which earns interest. Although less risky and more certain than a Stocks & Shares JISA, the returns may be relatively modest over the longer term.
An adjustment made to the amount we pay out, should your policy fund be worth more than your fair share of the With-Profits fund.
The value of the amount paid in plus any bonuses added to your JISA.
A tax-free wrapper for investments other than cash deposits.
The name given to a type of fund which normally contains a mix of assets and shares the profits or losses with the policyholders. Returns are ‘smoothed’ whereby some profit is held back in good years to maintain returns in poorer investment years.
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