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Don’t forget Child Trust Funds

October 26, 2011

TISA is reminding parents whose children hold a Child Trust Fund to review their investment when the new Junior ISA is launched on 1 November.

CTFs will run alongside JISAs and, crucially, will also benefit from the same maximum annual contribution level of £3,600 – an increase of £2,200 on the previous CTF limit.

Tony Vine-Lott, TISA Director General says:

“Whether your child has a CTF or a JISA it is important to ensure that the money is in an account that best meets their needs – bearing in mind that this is a long-term investment of 18 years. I would urge parents with a CTF to make full use of the higher contribution limit and to regularly review the investment performance. Transferring a CTF – or a JISA – is a straightforward process.”

TISA’s last survey (15 June 2011) of more than 4 million CTFs, representing 71% of all CTF accounts, revealed that £19.6m is being paid into CTFs each month via direct debit subscriptions.

“Based on this, I expect the new JISA to be as equally as popular” commented Tony Vine-Lott. “There is a strong desire by parents to ensure that their children have a financial asset at 18. Both schemes allow family and friends to contribute towards this.

“It is often overlooked that schemes such as these also have the potential to improve the financial literacy of youngsters – it clearly demonstrates the benefits of regular saving over the longer term and that has got to be a good message to get across.”

Children born between 1 September 2002 and 2 January 2011 who qualified for a CTF are not eligible to also open a JISA. All other children may have a JISA opened on their behalf.*

JISA and CTF key information:
JISA available to children: All children who were not eligible for a CTF
CTF available to children: Born between 1 September 2002 and 2 January 2011 who were eligible for and claimed child benefit

Annual contribution limit:
JISA: £3,600
CTF: £3,600 wef 01/11/2011

Contribution indexation:
JISA/CTF limit indexed to CPI wef 06/04/2013

Age at which child is responsible for managing their own account:

Funds locked in until child reaches 18?

Automatically default into an adult ISA on maturity?

Government contributions?
CTF – No further contributions

Cash and Investment options available?

Transfers permitted?
JISA – Yes, but only between JISA providers
CTF – Yes, but only between CTF providers

Number of accounts that can be held
JISA – One stocks & shares and one cash JISA
CTF – One

*All children under 18 who did not qualify for a CTF will be able to open a JISA, dependent on meeting the appropriate JISA eligibility criteria. To qualify for a CTF, the child had to be born between 1 September 2002 and 2 Jan 2011 and have had Child Benefit claimed for them. It was the claim for Child Benefit which triggered the issue of the voucher which was then used to open the CTF. (Slightly different rules applied for children in care). This therefore means that any child who was not born in the UK between those dates and/or who did not have Child Benefit claimed for them, was not eligible for a CTF and therefore is instead eligible for a JISA.


For further information, please contact:

Carol Knight, Director of Member Services, TISA – Tel: 01642 666989, Mobile: 07967 317003Email: carol.knight@tisa.uk.com

Issued on behalf of TISA by Cauldron Consulting, contact Steve Radford – Tel: 020 3178 7238, Mobile: 07889 903786 Email: steve.radford@cauldron-consulting.com

Notes for Editors

The Tax Incentivised Savings Association (TISA)
TISA is the premier industry funded body in the UK retail savings and investment industry. By engaging with member firms, government, political parties, regulators and consumer groups TISA’s ultimate goal is always to further consumers’ best interests. It seeks to improve the range, features and quality of savings and investment schemes available whilst encouraging more people to save for their financial security and peace of mind.

Uniquely, TISA is able to articulate the opinions of the whole savings and investments marketplace through its membership comprising over 120 member firms involved in the supply or distribution of products. TISA’s remit extends across the broad spectrum of government sponsored savings and investment vehicles.