What is a Junior ISA (JISA) and how does it work?

A Junior ISA is a purpose-built account for a child, which allows money to be saved or invested tax-efficiently until they reach adulthood. 

Being a grown-up is expensive. Between higher education, housing, and travelling the world, there are plenty of things you might want your child to have or experience. That’s why giving them a financial head start can be a good idea. 

Find out more about what Junior ISAs are, how they work, and whether a Stocks and Shares JISA may suit your child’s needs and goals. 

How does a Junior ISA work?

A Junior ISA works a lot like an ISA.

Simply put, it’s a tax-free account designed to help you save or invest for a child’s future. While opened and managed by a parent or guardian, the money belongs to the child and cannot usually be accessed until they turn 18. 

There are cash Junior ISAs, which work like a savings account, or stocks and shares Junior ISAs, which allow you to invest money for potential long-term growth. 

What is the Junior ISA allowance for the 2025/26 tax year?

The annual allowance is £9,000 for the 2025/26 tax year. This allowance applies per child and cannot be carried forward into future tax years. The allowance can be split across both types of JISA accounts. 

For example, you may use up the total £9,000 allowance by contributing £5,000 to a child’s stocks and shares JISA and £4,000 to their cash JISA. 

It is worth noting that the JISA limit is in addition to a parent or guardian’s ISA allowance. This means that once you have contributed £20,000 to ISAs within a tax year, you can still contribute £9,000 to any child’s JISA. 

What are the Junior ISA rules?

Who can open a Junior ISA?

A Junior ISA usually must be opened for a child by their parent or legal guardian. 

Remember that the child must also be eligible for an account. 

A Junior ISA can be opened for a child (that’s anyone under the age of 18) who is:

• A UK resident 

OR

• Living outside the UK as the child of a Crown servant, such as a member of the British Armed Forces, dependent on that parent for their care

How many Junior ISAs can a child have?

A child can have a maximum of two Junior ISAs: one stocks and shares Junior ISA, and one cash Junior ISA. 

However, if a child has a Child Trust Fund (CTF), they cannot have any Junior ISA accounts. Instead, they would need to transfer their CTF into a new Junior ISA account, closing the trust fund as part of the process. 

Who can pay into a Junior ISA?

While a Junior ISA must be set up by a parent or legal guardian, anyone can contribute to the account once it is open. 

That means grandparents, aunts and uncles, siblings, cousins, friends, and other more distant benefactors can contribute to the account. However, contributions to Freetrade JISAs must come through the account’s registered contact.

However, remember that annual contributions are limited to £9,000 per child, not per contributor.

When can a Junior ISA be accessed?

The money in a Junior ISA belongs to the child, not their parent or guardian. The child is typically the only person who can access the money, and they can only do so once they are 18. 

If a child is terminally ill, their registered contact can apply to HMRC to access the money early. 

What happens when a Junior ISA matures?

On a child’s 18th birthday, they legally become an adult. Their Junior ISA undergoes a similar transformation, becoming a fully fledged adult ISA. 

The now 18-year-old has full control of this ISA, and can withdraw their money and spend it as they wish, or continue investing or saving. 

What are the different types of Junior ISAs?

Cash Junior ISA

A cash JISA offers interest on cash savings. Depending on the account, this interest rate may be fixed for a period of time or variable. 

This is a lower-risk option with guaranteed growth, and may be more appropriate if the account will need to be accessed in the short term. 

However, the potential growth may be lower than that offered by investing. In addition, growth may not keep up with inflation, meaning money could lose value in real terms. 

Stocks and shares Junior ISA

Just like a full-fledged stocks and shares ISA for adults, a stocks and shares JISA account allows you to invest in shares, ETFs, funds, and more. 

This offers the registered contact control over how money in the account is invested, allowing you to build a portfolio to fit your goals for your child’s money. They may be more appropriate if you have longer-term goals for your child’s money. 

Keep in mind that returns depend on the performance of the stocks, funds, and other assets you invest in, and that the value of these investments can go down as well as up. 

Which is right for you?

Still not sure which to choose? Think about your:

• Risk tolerance: Can you stand to see the portfolio dip in value? If you do not have the stomach for potential market fluctuations, a stocks and shares JISA might not be right for you. 
• Time horizon: If there is less time until the child turns 18, a stocks and shares account may be more vulnerable to sudden market drops. Longer time horizons can reduce the impact of short-term market volatility, but losses are still possible. 
• Goals and growth expectations: How much do you want or need the money to grow? Cash JISAs might offer certainty, but their potential returns could be exceeded by a stocks and shares JISA portfolio depending on performance. 
• Responsibility: Are you comfortable with picking investments and living with the consequences? Building a portfolio can be stressful, and reactive or panicky decisions can have a negative impact. That being said, some JISAs, such as Freetrade’s, include low-stress investment options like ready-made portfolios.

Remember, it does not have to be an either/or decision. A child can have both! 

What can you invest in a Junior ISA?

Depending on the provider, a stocks and shares JISA will allow you (or your child at age 16+) to invest in stocks, ETFs, funds, and more. 

A Freetrade JISA allows you to choose from over 7,000 different investment options. You can even choose between three ready-made portfolios if you are not keen on assembling a basket of investments yourself. 

What is the difference between a Child Trust Fund (CTF) and a Junior ISA?

You might also have heard of Child Trust Funds (CTFs). These accounts preceded JISAs and functioned similarly. They were discontinued in 2011 with the launch of the JISA, and you cannot open a new CTF account. 

If you or your child has an existing CTF, you might consider transferring it into a JISA. 

Be aware that you cannot have both a CTF and a JISA. 

Check out the comparison table below for information about the differences between the two accounts.

How to transfer a CTF to a Junior ISA?

You can transfer a CTF to a Junior ISA, but you will need to close it as part of the transfer process, as you cannot hold both account types at the same time. 

Contact the Junior ISA provider of choice, or begin their transfer process. Make sure to have relevant CTF details to hand, including account numbers and provider details. 

Junior ISA (JISA) FAQs

How much can you put in a Junior ISA each year?

You can put £9,000 in a JISA each tax year.

Can grandparents open a Junior ISA?

You must be a parent or legal guardian of a child to open a Junior ISA on their behalf. However, grandparents, or anyone else for that matter, can pay directly into a child’s JISA once it is open. Contributions to Freetrade JISAs must come via the account’s registered contact.

Can you have both cash and stocks and shares Junior ISAs?

A child can have both a cash and a stocks and shares Junior ISA. 

Are Junior ISAs tax-free?

Junior ISAs are tax-efficient wrappers, which means they offer tax-free savings and investment growth. 

Who can contribute to a Junior ISA?

Anyone can contribute to a Junior ISA. However, contributions to Freetrade JISAs must come through the account’s registered contact.

When does a Junior ISA convert to an adult ISA?

A Junior ISA automatically becomes an adult ISA for the child when they turn 18. 

Can you withdraw from a Junior ISA before age 18?

A child cannot withdraw from a Junior ISA until they turn 18. A child will take control of managing the account from the age of 16, though they must wait two years before they can withdraw any money. 

How do you transfer a Child Trust Fund to a Junior ISA?

You can transfer a Child Trust Fund to a Junior ISA if you are the account’s registered contact. To do so, contact the provider of the Junior ISA account you wish to transfer into. Make sure you have all the relevant details of the Child Trust Fund, including the provider name and account numbers. 

If you have lost a Child Trust Fund, you can track it down using HMRC’s trust fund finder tool.