Funding Junior Cash ISA and Adult ISA in the Same year for over 16s (but under 18s)

ForumUser7

Hi,

I have seen in the MSE article regarding JISAs that 'When a child turns 16 they can open a normal cash ISA in addition to a junior ISA (however, they cannot open an adult stocks & shares ISA or a Lifetime ISA until they are 18).' but I was unable to see if you are able to fund both in the same tax year.

In this current tax year, are you able to put £9,000 tax free into a JISA and £20,000 tax free into an adult cash ISA please?

Hoping someone has had experience with this and knows the answer!

Thank you very much,

ForumUser7

xylophone

See https://www.moneyhelper.org.uk/en/savings/types-of-savings/junior-

16 and 17-year-olds can also contribute into the adult equivalent of a Cash ISA (not an adult Stocks and shares ISA), up to the £20,000 limit in the 2022/23 tax year. This is on top of any money paid into their Junior ISA.

https://moneyfacts.co.uk/isa/guides/junior-isa-loophole-for-16-and-17-year-olds/

Maybe it's deliberate, maybe it's just an oversight, but 16 and 17-year-olds currently get two ISA allowances: £9,000 for a Junior ISA and £20,000 for an adult cash ISA.

That's because they're allowed to open an adult cash ISA from the age of 16 alongside their Junior ISA, which won’t get turned into an adult cash ISA until they turn 18. So, under the current rules, they could squirrel away up to £29,000 in ISAs for the 2022/23 tax year.

xylophone

if you are able to fund both in the same tax year.

Another thought, interest earned on any money gifted to the JISA by a parent/parents will not be subject to the £100 rule.

The £100 applies separately to each parent.

But what is the position if the parent/parents  gift the £20,000 for the ISA and the interest earned is over £100 per parental gift?

See https://www.gov.uk/hmrc-internal-manuals/trusts-settlements-and-estates-manual/tsem4310

ForumUser7

Thanks so much @xylophone, that’s really really helpful! I’ll have a close look at the thing about the parental interest aspect

Unpensioned56

I hope it's ok to reopen this - I had such a similar question. What happens in the tax year a child turns 18? If they have contributed to a jr cash isa, a jr s&s isa , and an adult cash ISA. The Jr Cash ISA then converts at 18 to an adult one, then they have two adult cash isas both of which they have contributed to in that tax year? (They are with different providers, in our case)

surreysaver

Unpensioned56 said:

I hope it's ok to reopen this - I had such a similar question. What happens in the tax year a child turns 18? If they have contributed to a jr cash isa, a jr s&s isa , and an adult cash ISA. The Jr Cash ISA then converts at 18 to an adult one, then they have two adult cash isas both of which they have contributed to in that tax year? (They are with different providers, in our case)

Presumably, any money contributed to the jISA before it matures is okay. Just wouldn't be able to contribute to it after it has turned into an adult ISA if you have another adult ISA that you've contributed that tax year 

xylophone

The regulations permit the young person to subscribe to JISA (cash/S&S/combination) and an adult ISA in the same year.

The fact that the JISA "converts" to adult status does not seem to me to be a problem.

https://moneyfacts.co.uk/isa/guides/junior-isa-loophole-for-16-and-17-year-olds/

If one takes an example of John Brown who in 2022/3 has contributed a total of £9000 to his JISA account(s) and (say) £18,000  to his adult ISA and who turns 18 on March 5, he may still contribute op to £2000 to the adult ISA?