Junior ISA saving rates raised 2.5% from April 2019

Piggy bank

The annual saving limit for Junior ISAs and Child Trust Funds (CTF) is set to rise 2.5% from 1 April for the estimated six million child account savers.


The annual Junior ISA and CTF savings limit will increase by £108 from £4260 to £4,368 from 6 April 2019, equivalent to 2.5%. The interest and gains received on money saved in a Junior ISA and CTF is tax free, as per standard ISA rules.


The savings initiative was originally designed to support savings for children. Junior ISAs and CTFs are held by around six million children. A study in 2018 by Scottish Friendly suggested that up to 1.5 million CTFs were unclaimed as parents had lost track of them. An estimated 907,000 Junior ISAs were paid into during the 2017-2018 tax year. 


Under CTF rules, current holders can continue to add up to £4,260 a year to a CTF account. The money belongs to the child and they can only take it out when they reach 18, although they can manage the account from the age of 16. CTF accounts can also be transferred to a Junior ISA at any time.


The account rules for CTF, including the amount that can be paid into an account are set in the Child Trust Funds Regulations 2014. The interest rate rise was announced at  Autumn Budget 2018.


The CTF regulations will be amended by the Child Trust Fund (Amendment) Regulations 2019 to increase the amount that can be paid into a CTF each year from £4,260 to £4,368.