While a Stocks and Shares ISA offers the potential of greater growth than a Cash ISA, it also comes with a risk that the value of investments can go down as well as up, so your Child may get back less than what you pay in.
Who can open an ISA?
If your Child is under the age of 18, you can open a Junior ISA for them. Your Child must be resident in the UK and must not have a Child Trust Fund. Your Child can hold only one Junior Cash ISA and one Junior Stocks and Shares ISA at any time.
Who is the Registered Contact on the ISA?
The Registered Contact is the individual with the parental responsibility for the Child and is usually a parent or legal guardian of the Child under the age of 16. When the Child reaches the age of 16, they can apply to become the Registered Contact on the ISA.
Can I transfer my Child’s existing Junior ISA to a TFS Junior ISA?
Yes, you can transfer your Child’s existing Junior ISA or Child Trust Fund to a TFS Junior ISA by completing a Transfer Form, which we will send to your Child’s current provider, to ensure your Child’s tax exemption is not lost.
Please do not close or withdraw the money from your Child’s existing Junior ISA yourself when transferring your Child’s existing Junior ISA, as your Child will lose the tax benefit.
Can my Child have more than one ISA?
Your Child may only have one Junior Cash ISA and one Junior Stocks and Shares ISA. The TFS Junior ISA is a Stocks and Shares ISA.
Can my Child have a TFS Tax-Free Children’s Savings Plan and a TFS Junior ISA?
Yes, your Child can have both, as their annual ISA allowance is separate from their TFS Tax-Free Savings Plan’s tax-exempt allowance.
How do I invest into my Child’s TFS Junior ISA?
You can invest regular monthly amounts and/or lump sum investments into your Child’s Stocks and Shares ISA up to the maximum annual limit for the particular tax year.
How much can I invest in my Child’s TFS Junior ISA?
The minimum monthly payment is £30 a month, which can be increased at any time.
The minimum initial lump-sum payment into your Child’s Junior ISA is £500. Additional lump-sum payments of at least £30 can be made at any time.
Can I stop or change my payments?
The TFS Junior Stocks and Shares ISA is flexible so you can change or suspend the amount of your payments into your Child’s Junior ISA at any time. However, the money in the Junior ISA can only be accessed by the Child when they are 18.
Can I make withdrawals?
No – any money you pay in to the Junior ISA is a gift to the Child and cannot be repaid to you after the 14 day cancellation period has expired. Your Child can take control of their Junior ISA account when they are 16 by becoming the Registered Contact, but they cannot withdraw the money until they are 18.
Where will my contributions into my Child’s Junior ISA be invested?
You have a choice of two funds, both of which are environmentally friendly.
The Developed Markets Fund invests in shares in companies that demonstrate good environmental, social and governance (ESG) efforts in developed countries.
The Multi-Index Fund invests in bonds, shares in companies, money market instruments, deposits, cash and indirectly to alternative asset classes (such as commodities) and property.
How do I choose a fund?
You can find out more about both funds from our Information leaflets to help you decide. You may wish to invest solely in one fund or spread your contributions into your Child’s Junior ISA into both funds. You are also free to switch between funds.
How will my Child’s investment grow?
Stocks and Shares Junior ISA money is invested in stock markets over a long period of time which usually delivers better returns than cash accounts.
Past performance is not a guide to future returns, and stock market investments can go down in value as well as up. If you invest in the stock market you could get back less than you put in.
How will I know what my Child’s Junior ISA is worth?
We will send your Child an annual statement detailing any payments in, and charges deducted by the Society and the current value of your Child’s Junior ISA as at the date of their annual statement.
Are there any charges?
We will charge you an annual fee of 1.5% of the value of your Child’s Junior ISA, in order to cover the costs of managing your Child’s Junior ISA.
Will my Child pay tax?
There is no liability for Income or Capital Gains Taxes during the life of the ISA, or on cashing it in.
What happens when my Child is 16?
When your Child becomes 16, they can apply to become the Registered Contact so that all future communications are addressed to them, BUT they will not be able to withdraw any money from their TFS Junior ISA until they are 18.
What happens when my Child is 18?
Shortly before your Child becomes 18, we will send them details of the options available to them upon reaching 18, including transferring their investment in the TFS Junior ISA into the TFS Adult Stocks and Shares ISA or withdrawing the money.
What are the risks?
While the aim of the funds is to give your Child a fair return on your contributions into their Junior ISA, it is important to remember that the value of investments can go down as well as up, so your Child may get back less than what you pay in.
Can I cancel my Child’s TFS Junior ISA if I change my mind?
You have the right to change your mind about your investment up to no later than 14 days after you receive TFS’s Cancellation Form, which you are advised to read carefully.
If you decide to cancel your investment, you are entitled to have repaid to you any money you have invested in your Child’s TFS Junior ISA subject to a deduction of the amount (if any) by which the value of your investment has fallen at the time when your Cancellation Form is received by the TFS.
Cancellation within 14 days
If you cancel within the 14 day cancellation period your cancelled subscription does not count as a subscription to a Junior ISA and you can subscribe to another Junior ISA of the same type in the same tax year.
Cancellation after 14 days
The Junior ISA cannot be cancelled once the 14 day cancellation period has expired, as the ISA becomes valid and any money you have invested in your Child’s TFS Junior ISA will not be repaid to you. The account will be frozen until the Child turns 18 or the Junior ISA is transferred to another provider. Your subscription into the Junior ISA will not be repaid to you.
If you cancel outside the 14 day cancellation period, your cancelled subscription counts as a subscription to a Junior ISA and you cannot subscribe to another Junior ISA of the same type in the same tax year.
How do I complain?
If You have a complaint, feel you have been treated unfairly or are not satisfied with any aspect of the Society, its products or services you can in the first instance complain to the TFS and if you are not happy with our response you can complain to the Financial Ombudsman Service.
What would happen if my Child died?
If unfortunately, your Child dies, their Junior ISA would terminate and all the investments in the Junior ISA would be sold by TFS and 101% of the value of all the proceeds would be forwarded to the Registered Contact to be added to the Child’s estate.