THE government has confirmed that it will launch a junior version of the Individual Savings Account (Isa), making the tax-free scheme available from 1 November this year.
The new investment fund replaces the Child Trust Fund (CTF), which had a limit of £1,200. The junior Isa will have a £3,000 limit.
Children will be able to have one cash Isa and one in stocks and shares at any time, adding up to the overall contribution limit.
It will be the first time that those under 18 will be allowed to hold shares in their name.
Like CTFs, withdrawals won’t be available from the junior Isa until the holder turns 18.
But they will not benefit from the £50-£250 government contribution made under the current system when an account is opened.
Today’s launch included a consultation document, which the Treasury will accept comments on until May.