Top 6 tax-free savings accounts for children - ISAs - News - Moneyfacts

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Top 6 tax-free savings accounts for children

Top 6 tax-free savings accounts for children

Category: ISAs

Updated: 22/01/2013
First Published: 21/01/2013

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.
It is never too early to teach your child the value of saving money and a number of providers offer accounts designed specifically for young savers.

If your child is under the age of 18 and does not already hold an existing Child Trust Fund (CTF) then you may want to consider a Junior ISA. Your child will hold a CTF if they were born between 1 September 2002 and 1 January 2011.

Up to £3,600 can be invested in a Junior ISA over the 2012-13 tax year (which runs from 6 April 2012 to 5 April 2013), and, as with adult ISAs, any interest acquired on these accounts will not be subject to tax.

It is important to remember that only one Junior cash ISA can be opened and held during the tax year and that Child Trust Funds cannot be transferred to a Junior ISA.

2012-13 Junior ISA allowance

In the 2012-13 tax year (which runs from 6 April 2012 to 5 April 2013) you can save or invest up to £3,600 in a Junior ISA.

Here are the current top 6 Junior ISAs:

Coventry BS
Coventry Building Society
Junior Cash ISA (1)
3.25% AER/Gross
  • Minimum investment £1
  • Transfers in are accepted
  • Apply online, by post, by telephone, or in branch
  • Interest paid on 30 September and when the child reaches 18
  • Withdrawals not permitted until child reaches 18

Penny says: "Coventry Building Society leads the Junior ISA market with this competitive rate of 3.25%.

"Transfers in can be made from other accounts held with Coventry Building Society and previous Junior ISA allowances."


Nationwide Building Society
Smart Junior ISA

3.25% AER/Gross
  • Minimum investment £1
  • Introductory bonus of 1.15% paid until 31 January 2014
  • Transfers in are not accepted
  • Apply online or in branch
  • Withdrawals not permitted until child reaches 18

Penny says: "Matching Coventry Building Society's Junior Cash ISA (1) rate is the Smart Junior ISA from Nationwide Building Society.

"Whilst this account offers a highly competitive rate, it is important to remember that it will fall to 2.10% once the introductory bonus expires on 31 January 2014."


Furness Building Society
The Furness Junior ISA

3.05% AER/Gross
  • Minimum investment £1
  • Transfers in are accepted
  • Apply in branch or by post
  • Withdrawals not permitted until child reaches 18

Penny says: "In bronze position is the Furness Junior ISA paying a healthy variable rate of 3.05% for investments of just £1 and over.

"Although funds can not be withdrawn until the child turns 18, this deal offers flexibility with payments at the provider's discretion."


Mansfield Building Society
Cash Junior ISA (1st Issue)

3.05% AER/Gross
  • Minimum investment £1
  • Transfers in are accepted
  • Apply in branch or by post
  • Withdrawals not permitted until child reaches 18, unless under exceptional circumstances and at the provider's discretion

Penny says: "Also paying a competitive tax-free rate of 3.05% is the Cash Junior ISA (1st Issue).

"Interest is calculated on a daily basis and transfers in can be made."


Market Harborough Building Society
Junior ISA

3.05% AER/Gross
  • Minimum investment £1
  • Transfers in are accepted
  • Apply in branch, by post or online
  • Interest is paid annually on 31st March
  • Withdrawals not permitted until child reaches 18

Penny says: "Market Harborough's Junior ISA pays a rate of 3.05% for investments of £1, with transfers in accepted.

"This account should attract interest from parents, grandparents or family friends looking for a competitive tax-free return."


Skipton Building Society
Junior ISA

3.02% AER/Gross
  • Minimum investment £1
  • Transfers in are accepted
  • Apply in branch only
  • Interest paid annually at midnight the day before the child's birthday
  • Withdrawals not permitted until child reaches 18

Penny says: "Savers in the Skipton area will be pleased with this attractive variable ISA which sits comfortably within the top ten best buys.

"As well as an appealing rate, this account allows transfers in from previous ISA allowances."

What Next?

View six best buy Junior ISAs with up to the minute rates - Compare the best Junior ISAs

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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