Junior isa allowance changes next month - inheritance tax warning
Junior isa allowance changes next month - inheritance tax warning"
- Select a language for the TTS:
- UK English Female
- UK English Male
- US English Female
- US English Male
- Australian Female
- Australian Male
- Language selected: (auto detect) - EN
Play all audios:
A Junior ISA is a long-term tax-free savings account for children, of which there are two types: a cash Junior ISA and a stocks and shares Junior ISA. In the 2019 to 2020 tax year, the
maximum that can be saved in a Junior ISA is £4,368. However, Chancellor of the Exchequer Rishi Sunak delivered the Budget 2020 last week, with this financial statement revealing changes to
the Junior ISA. In a big boost for those saving tax-free for children, the allowance is set to rise by £4,368 to £9,000 per tax year. Following Mr Sunak's speech, Money Saving Expert
founder Martin Lewis read through the details of the 2020 Budget, and took to Twitter to comment. Mr Lewis wrote: "Starting to look through the detail it seems they may well be
increasing the Junior ISA allowance (for under 18s) from £4,368 to £9,000, a massive hike, though actually as there are far fewer taxes on people's savings these days not such an
impact." READ MORE: MARTIN LEWIS GIVES INSIGHT AS MAN FEARS FOR PENSION & LIFE SAVINGS IN CORONAVIRUS PANDEMIC This means that the amount that can be saved in a Junior ISA in each
tax year would increase from £4,368 to £9,000. Kay Ingram, Director of Public Policy at LEBC Group and a Chartered Financial Planner, told Express.co.uk what the changes could mean for
parents and grandparents saving, or looking to save, in a Junior ISA. The chartered financial planner said: "Parents and grandparents wishing to give grandchildren a good start may pay
into a JISA but only a parent or guardian can establish one. "The new limit could enable wealthy families to pass on a considerable amount of wealth." DON'T MISS However, Ms
Ingram did point out that families may need to watch out when it came to rules abouts Inheritance Tax - of which the standard rate is 40 percent above a certain threshold. "However care
would need to be taken as the annual gift allowance on an Inheritance Tax free basis is £3,000 per donor (with one year’s allowance carried forward) or £250 per recipient," she said.
"Anything over this limit would remain potentially chargeable to Inheritance Tax for seven years. Parents and grandparents wishing to make larger gifts would need to take this into
account. "If they have surplus income they could make regular payments over more than one tax year, which are exempt from Inheritance Tax immediately, with no upper monetary limit.
"Given current market volatility, making regular payments also offers the advantage of buying shares over a longer time frame and evening out the price paid and so smoothing out the
peaks and troughs of the stock market and reducing the risk of a large loss compared to a one off lump sum investment." Also commenting on the changes to the Junior ISA, Carol Knight,
Chief Operating Officer at TISA, said: “It is a lot easier to build a substantial sum of money when investing over a long period of time. "The Government sent a strong message about the
importance of saving from a young age when the Chancellor announced a significant rise to the annual subscription limit of Junior ISAs and Child Trust Funds from £4,368 to £9,000 in the
Spring Budget. “While the increase in the annual subscription limit isn’t expected to cause waves in the market, as the full allowance cannot be taken advantage of by most - the average
subscription into a JISA is currently just £994 – this rise may encourage more banks, building societies and other financial institutions to offer JISAs. "This is because they could
become more valuable, especially when the account holders turn 18 and consider transferring these savings into an ISA. “We would also like to see the Government encourage and nudge families
to take a closer look at the benefits of early savings, given the enourmous advantages a little early financial planning can deliver." James McManus, chief investment officer, Nutmeg,
said: “The new Junior ISA limit means people can give the children in their life a truly meaningful financial head start – perfect to fund important financial milestones and costs such as
university fees, gap years, and house deposits. "It also means we can start to build a long-term saving culture, which is very much needed to tackle the UK’s savings gap, from an early
age. “While in the past people may have thought that savings accounts and cash savings could achieve a healthy nest egg for your child, in reality, given current savings and inflation rates
and today’s cut to the base rate, investing in stocks and shares, can be a more effective way to invest for your child’s future. "An investment that benefits from compound returns over
a longer-timeframe could mean your child goes into adulthood with a significant sum of money.”
Trending News
Fashion - Los Angeles TimesAdvertisement Headlines Inside the buzzy closet sale for L.A. fashion ‘it’ girls Averse to the pomp and circumstance tha...
Britain's got talent viewers floored by announcement seconds into finalTHE FINAL DREW COMPLAINTS FROM FANS WITHIN MINUTES OF BEING AIRED 19:29, 31 May 2025 The Britain's Got Talent final...
Tiger shroff to visit mount kailash for this reason!This young gun is currently shooting for his upcoming musical, Munna Michael, in Egypt and Jordan, and will later kickst...
The pigment, trichosiderin, from human red hairABSTRACT SORBY1 first described the pink pigment extractable from human red hair by hot acids, and its properties were f...
Channelnews : exclusive: aqipa restructures new ceo appointedIn a move aimed at expanding their Australian operation European management of the Austrian owned Company have appointed...
Latests News
Junior isa allowance changes next month - inheritance tax warningA Junior ISA is a long-term tax-free savings account for children, of which there are two types: a cash Junior ISA and a...
Busts of bhagat singh, sc bose, veer savarkar installed in duUpdated: Aug 21, 2019, 08:55 PM IST The busts of Bhagat Singh, Subhas Chandra Bose and Veer Savarkar were installed outs...
Volunteer to support diversity and inclusionHOW DOES AARP SUPPORT DIVERSITY AND INCLUSION? AARP’s 38 million members are diverse — different races, colors, genders,...
Strictly come dancing 2019 exit: who left strictly tonight?BBC series Strictly Come Dancing bid farewell to another couple this evening (Sunday, November 24) with just five couple...
404 Not Found!You're using an Ad-Blocker. BeforeItsNews only exists through ads.We ask all patriots who appreciate the evil we expose ...