Junior ISA

The Junior ISA is an Individual Savings Account which allows investments to grow tax-free and is available to all children living in the UK under the age of 18, who were not entitled to a Child Trust Fund (CTF) Account. In addition CTF investments can be transferred to a Junior ISA providing the CTF account is closed.

The Junior ISA allows for tax free investments to be made on behalf of a child, subject to qualifying conditions laid down by HMRC regulations. Upon reaching 18 years of age the value of the fund is made available to the child as the sole beneficiary.

There are two types of Junior ISA on the market: Stocks & Shares and Cash. We only offers a Stocks & Shares Junior ISA with a small amount of Life Assurance built in.

Our Junior ISA can only be opened by someone who has parental responsibility for the child and is aged 16 years or above. The person who sets up the Junior ISA is known as the ‘Registered Contact’. This person will be responsible for the running of the Account on the child’s behalf until the child reaches at least 16 years of age, or, the registered contact signs over responsibility to another adult with parental responsibility.

Once a child reaches 16 years of age they may opt to take over responsibility of the running of their Account themselves.

Our Junior ISA may not be opened in the name of a child who already has a Stocks & Shares Junior ISA or a Child Trust Fund unless the account is closed and the investments are transferred to our Junior ISA.

Parents, grandparents and other family and friends are able to make contributions to the Account up to the HMRC Junior ISA contribution limit in each tax year. The current limit can be found in our Contribution Limits page. It is anticipated that this limit will increase each year in line with Inflation.

The account can be opened with an initial contribution of £1. You can also pay by Direct Debit from as little as £10 per month, and contributions can be stopped or changed at any time without penalty.

Contributions can be made in a number of ways;

• regular monthly payments by Direct Debit or standing order
• payments by cheque - made payable to ‘’Unity Mutual’ with your child’s name and Junior ISA number on the back
• payments by direct money transfer - ensuring your child’s Junior ISA number is quoted in the transfer

The minimum additional contribution is £10, and contributions can be stopped or changed at any time without penalty.

All money paid into the Account belongs to your child, which can only be accessed when they reach age 18.

The money is invested in the Unity Mutual Equity Fund. The investment objective of this Fund is to track the capital performance of the UK stock market by investing in over 600 UK companies. As the Fund’s investments are spread across a wide range of companies, the risk of it being affected by a single underperforming company or sector is reduced.

The contributions you pay are used to purchase units in the Fund (refer to sections ‘1. Definitions’ and ’18. Unit Prices’ within the Terms & Conditions).

The investment performance of the Fund will determine the value of your child’s Junior ISA.

A statement will be issued annually which will show the value of the Junior ISA plan, or you can also contact us at any time to ask for a valuation.

However, at any time you can always visit the 'My Fund Value' page within the 'Customer Centre' of our website where you can get an up-to-date value.

You can also contact us at any time to ask for a valuation.

You should aim to invest for no less than five years as an investment of less than five years may not return any real growth.

You should bear in mind that over the mid to long term (5-10 years and over), inflation is likely to erode the purchasing power of your child’s investment.

Risk Indicator

The Summary Risk Indicator (SRI) assumes you keep the plan for 18 years. The actual risk can vary significantly if you cash in at the early stage and you may get back less.

Note, the plan cannot be cashed in before age 18, it can only be transferred.

We have classified this account as 4 out of 7, which is “medium” risk class. This rates potential losses from future performance at a medium level.

The risk category is not guaranteed and may shift over time.

On closing the Junior ISA you would receive the current value of units. On death, you would receive the same with a guaranteed minimum of 101% of the current value.

The risk indicator is based on historical data and may not be relied upon to gauge the future risk profile of the product.

The illustrations below give a guide to how much your investment could be worth in the years ahead in accordance with requirements set by the Financial Conduct Authority (FCA) for illustration purposes. What you will receive depends on how much is invested, the actual rate at which the investment grows and the tax treatment of the investment.

 A. Regular monthly payments

Assuming that £25 per month is invested for 17 years, the table below shows how much your investment would be worth, after charges, if it grows each year by:

B. Lump sum investment payments

Assuming that a single payment of £3,000 is invested for 17 years, the table below shows how much your investment would be worth, after charges, if it grows each year by:

Please note that for both illustrations:

These figures are only examples and are not guaranteed. What you will get back depends on how your investment grows and the tax treatment of the investment. You could get back more or less than the figures quoted.

Do not forget that inflation will reduce what your child can buy with the proceeds of their Junior ISA in the future.

We will take a management charge equivalent to 1% per annum of the Fund. A proportion of this charge is deducted weekly from the value of the Fund; it is the only charge made by us on the Junior ISA.

For example, if the value of the Fund was £1,000 throughout the year, we would deduct £10 in charges for that year.

Other charges may apply as outlined in section 16 of the Terms & Conditions.

The money in your child’s Junior ISA will be available to them on their 18th birthday.

The money cannot be kept in the Junior ISA after reaching age 18, but can be re-invested into an adult ISA if they wish. Verification of the child’s identity may be performed at this time.

No one can access the money in the Account before your child reaches age 18, except in certain exceptional circumstances.

If your child should die before their 18th birthday, 101% of the value of the Junior ISA on the date of death will be paid to the child’s estate.

If your child becomes terminally ill before their 18th birthday, it may be possible to withdraw money from the Account for the benefit of the child, subject to the consent of HMRC. A person is considered to be ‘terminally ill’ when the life expectancy is estimated to be six months or less.

Yes, you can transfer your child’s Junior ISA or CTF investment to us and we will not make a charge.

To do this, the registered contact will need to complete a transfer form. This can be obtained by calling us on 0151 724 1930.

When we receive this we will contact the other provider once any cancellation period has expired.

Your child’s investment in our Junior ISA can only be transferred to another Junior ISA provider.

All investment growth generated by Junior ISA investments is exempt from income tax and capital gains tax for UK residents. The proceeds of the Junior ISA, which will be paid out on the child’s 18th birthday, will be tax free as long as they are resident in the UK.

Tax could be payable on any income earned or gains realised by investments still held in the child’s name after their 18th birthday, or after their death if they die before the age of 18.

Taxes and legislation may change in the future. The information given here is based on our understanding of the current situation at the date of publication. If you have any queries or concerns about your personal tax position we recommend you consult your local tax office or a financial adviser.

We are covered by the Financial Services Compensation Scheme. If we cannot meet our obligations you may be entitled to compensation under the scheme.

This is an investment product, which means the child is entitled to 100% of the first £50,000 invested.

Further information on the scheme can be obtained from the Financial Services Compensation Scheme.

Tel: 0800 678 1100

http://www.fscs.org.uk/.