35k Child Trust Fund Transfer to ISA - options

BlueButterfly23

We have saved in my child's trust fund each year since birth and next year they will be 18. Options are to keep it there or transfer to a junior ISA or LISA. Looking to transfer to a junior ISA. However, the annual limit is 20k. To keep the tax free wrapper for them and allow them to continue to save what ever they might need, is the best option to transfer 20k now for this tax year and the rest 15k in the next tax year? 

refluxer

Transfers don't count towards the annual ISA allowance, so you can transfer the whole amount. You'd have to do this anyway as a child cannot hold both a Child Trust Fund and a Junior ISA.

The annual limit for new subscriptions into a CTF or Junior ISA is actually £9k during any one tax year.

xylophone

Looking to transfer to a junior ISA. However, the annual limit is 20k. 

There seems to be a misunderstanding of some sort here.

The maximum annual subscription to a CTF or Junior ISA is £9000 per annum.

https://www.gov.uk/junior-individual-savings-accounts

https://www.gov.uk/child-trust-funds

Have you made the maximum annual subscription to his CTF in his current CTF year?

https://saundersonhouse.co.uk/financial-planning-guide-transferring-child-trust-funds-to-junior-isas/

If not, you could  immediately subscribe up to the maximum for the  CTF year into the CTF, transfer to JISA within this tax year and subscribe £9000 to the JISA,  and then  subscribe the maximum £9000 for the tax year 2023/4 to the JISA.

The Coventry Building Society is one which will accept a transfer from CTF to JISA.

Do not forget that as soon as he becomes 18, your son is absolutely entitled to access to and control of the money in the account.

Indeed, as he is over 16, he could take control of the account now although not access it.

BlueButterfly23

Thank you. So the total amount of his CTF is 35k at present. Never managed to subscribe up to the maximum 9k a year. Totally understand they get access at 18, and with them I am looking at the best options so they can continue to grow.

So maybe I am confusing the annual cap for a Junior ISA with a transfer which is different. I have noticed some junior ISAs don't accept CTF transfers so will need one that does. I just don't want any transfer over to disadvantage. 

Thank you @refluxer I wasn't aware the transfer doesn't count towards the annual allowance. 

xylophone

I have noticed some junior ISAs don't accept CTF transfers so will need one that does. 

See my post above.

https://www.coventrybuildingsociety.co.uk/member/help/savings/isas/junior-isas.html#:~:text=If your child has a,take care of the rest.

refluxer

BlueButterfly23 said:

I have noticed some junior ISAs don't accept CTF transfers so will need one that does. I just don't want any transfer over to disadvantage. 

MSE's Top Junior Cash ISAs table shows the top 4 accounts and only two of those accept transfers in from a CTF - the Coventry BS (as mentioned above) and the Stafford Railway BS.

https://www.moneysavingexpert.com/savings/junior-isa/#bestbuys

Annoyingly, Junior ISA accounts with the best rates can often only be managed by branch or post only so, because of this, I would advise checking the rates offered by any building societies close to you which will makes things easier. These aren't always featured on comparison sites because they're sometimes restricted to local residents, but the rates can be very attractive. If you live in Bath, for example, their Junior ISA rises to 5% from tomorrow. The Junior ISA list on the 'This Is Money' site includes accounts with geographical restrictions.

NS&I currently pays the best rate for a Junior Cash ISA which can be managed online but note that they're not the quickest of outfits - transferring my son's CTF to them took around 7 weeks. Payments into their Junior ISA can also take anything from a day or two up to a week to show.