JISA to Adult ISA

Skibunny40

My daughter turns 18 shortly and I'm trying to be prepared. Her granddad currently pays into a JISA (S&S) and stakeholder pension for her and she has had a Help to Buy ISA since she was 16. I understand the JISA converts straight into an adult ISA when she turns 18 but can she then convert it into a LISA? Or keep the adult S&S ISA and open a separate LISA? Would a LISA affect how much money can be paid into her stakeholder pension? Can her granddad make payments directly into any/all of these, or does the money need to come from an account in her name? Sorry for all the questions and yes, I'm aware she should be figuring all this out of herself, but I will discuss it with her!

eskbanker

Answers inline:

Skibunny40 said:

My daughter turns 18 shortly and I'm trying to be prepared. Her granddad currently pays into a JISA (S&S) and stakeholder pension for her and she has had a Help to Buy ISA since she was 16. I understand the JISA converts straight into an adult ISA when she turns 18 but can she then convert it into a LISA? She won't be able to convert it as such but could transfer up to £4K into any LISA that accepts inbound transfers.

Or keep the adult S&S ISA and open a separate LISA? That's possible too.

Would a LISA affect how much money can be paid into her stakeholder pension? No.

Can her granddad make payments directly into any/all of these, or does the money need to come from an account in her name? There's nothing in the ISA rules preventing payments from third parties but individual products may have such terms, so she'll need to check when identifying products.

xylophone

I understand the JISA converts straight into an adult ISA when she turns 18 but can she then convert it into a LISA?

 She cannot convert the JISA or the adult ISA to a LISA. If the LISA provider permits transfers in, she can transfer up to £4000 from the adult ISA to a LISA.

https://www.moneyadviceservice.org.uk/en/articles/lifetime-isa-faq

She can keep the adult ISA and open a LISA.

https://www.which.co.uk/money/savings-and-isas/isas/lifetime-isas-ac6mf6s7r9d5

Parents and grandparents can also pay into a lifetime Isa opened by their child or grandchild, which could be a useful part of inheritance tax planning. 

Skibunny40

Thanks xylophone and eskbanker - lots to think about

Zorillo

She can transfer £4k every tax year into a LISA, so if she is 18 before April 5th she could get £8k 'wrapped up' by May.