1 November 2010
Junior ISA good news for families, says Saffron BS
Following the announcement by the Treasury to create a 'Junior ISA' for tax-free children's savings, Saffron Building Society commend the decision to help families provide for their children's futures.
Andy Golding, the Society's Chief Executive explained:
"Following the loss of Child Trust Funds, we were anticipating questions from parents within our customer base as to how best save for their children. The Junior ISA concept looks to provide a simple, tax-free way for parents to start a savings pot for their children from birth.
"We are also glad that the government plans to back-date the availability of these accounts so that children born after the end of Child Trust Fund eligibility will still be offered the Junior ISA, as it's unlikely to be available until Autumn 2011.
"While all children's saving is tax-free, should a gift from a parent generate more than £100 gross interest per year, this is normally taxed at the parent's level. This won't be an issue under the Junior ISA, meaning that parents can put money aside for children (up to a certain limit per year) with no tax concerns. In addition, once the child is 16, it can remain their ISA in their name indefinitely under a tax-free wrapper. Rather than starting an ISA at 16, the young adult will already have a significant sum earning tax-free interest.
"Saffron Building Society is poised to add Junior ISAs to its product development for 2011, and we look forward to further information as to how the accounts will function. We are committed to helping families in our area save for the future, and are excited that children will be able to take advantage of the hugely-popular ISA savings concept."
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