One of the most common questions we hear from families looking to secure their financial future is: “Can a grandparent open a Junior ISA?”
The short answer is no, not directly. Under UK government rules, a Junior ISA (JISA) can only be opened by a parent or a legal guardian with parental responsibility for the child. However, that does not mean grandparents cannot help. Once the account is open, grandparents can contribute freely, making it an excellent way to pass down wealth and support a grandchild’s future.
In this guide, we explain the rules for grandparents, how to pay into an account, and the tax benefits of saving for your grandchildren.
| Can a grandparent open a Junior ISA? | Only the parents or a legal guardian with parental responsibility can open a Junior ISA for a child. |
| Can I pay into my grandchild’s Junior ISA? | Anyone is able to pay money into a Junior ISA account. The only information necessary to pay into the account is the account number and the child’s date of birth. |
| How can I pay into my grandchild’s Junior ISA? | You can make a bank transfer, standing order, direct debit or write out a cheque to the account number and account holder |
Who Can Open a Junior ISA?
According to HMRC rules, a Junior ISA can only be opened by a parent or a legal guardian with parental responsibility for the child. The child must be:
- Under the age of 18
- A UK resident
If you are a grandparent, aunt, or uncle, you cannot open the account yourself. The control of the account — including decisions on where the money is invested (cash vs. stocks and shares) — lies with the registered contact (the parent) until the child turns 16.
What if I am the legal guardian?
If you are a grandparent who has been granted legal guardianship or parental responsibility by the courts, you are eligible to open the account on the child’s behalf.
How can a grandparent pay into a Junior ISA?
While you may not be the “Registered Contact” on the account, you are absolutely allowed to gift money into it. In fact, anyone is able to pay money into a Junior ISA account—including aunts, uncles, and family friends.
To make a contribution, you generally only need:
- The account number (and sort code if applicable).
- The child’s full name.
- The child’s date of birth.
Common ways to contribute include:
- Bank Transfer: A simple one-off payment from your bank account.
- Standing Order / Direct Debit: Perfect for setting up regular monthly savings.
- Cheque: Some providers still accept cheques made out to the account holder.
Because the account is managed by the parent, you will need to coordinate with them to get these details. It is also important to communicate about how much you intend to deposit to ensure the family does not exceed the annual contribution limit.
Junior ISA Allowance and Limits
When saving for grandchildren, you must be aware of the Junior ISA allowance.
For the 2025/2026 tax year, the maximum total amount that can be paid into a Junior ISA is £9,000. This limit applies to the account, not the contributor.
This means the combined contributions from parents, grandparents, and others must not exceed £9,000 in a single tax year. If the limit is exceeded, any excess payments may be returned or rejected by the provider.
Inheritance Tax (IHT) and Gifting
Contributing to a grandchild’s Junior ISA can also be a smart part of your estate planning. Gifts to a JISA may help reduce the value of your estate for Inheritance Tax (IHT) purposes.
- Annual Exemption: You can give away up to £3,000 per year tax-free. This can be paid into a JISA.
- Small Gifts Exemption: You can give up to £250 per person per tax year (as long as you haven’t used another exemption on the same person).
- Normal Expenditure: If you make regular payments from your surplus income (without affecting your standard of living), these may be exempt from IHT immediately.
Always consult a financial advisor or tax specialist regarding IHT planning, as rules can be complex.
Alternatives: Other Ways to Save for Grandchildren
If the parents have not opened a Junior ISA, or if you prefer to retain control over the money until the child is older than 18, consider these alternatives:
1. Open an Adult ISA in Your Name
You can save in your own Cash ISA or Stocks and Shares ISA.
- Pros: You keep full control and access. You decide when to give the money to the grandchild.
- Cons: It uses up your own £20,000 ISA allowance.
2. Premium Bonds
Premium Bonds can be bought for children under 16 by parents or grandparents.
- Pros: Secure, state-backed, and the chance to win tax-free prizes.
- Cons: No guaranteed interest return.
3. Child Trust Funds (CTF)
If your grandchild was born between 1 September 2002 and 2 January 2011, they might have a Child Trust Fund. You cannot open a new one, but you can contribute to an existing one (up to £9,000/year). Alternatively, the parents can transfer the CTF into a Junior ISA for better rates or investment choices.
FAQ
No, you cannot open the account, but you can usually contribute to an existing one even if you live outside the UK, subject to your own bank’s transfer fees.
On their 18th birthday, the Junior ISA automatically converts into an adult ISA. Your grandchild gains full access to the funds and can choose to withdraw them or keep them invested for the future.
Yes. If your grandchild has an old Child Trust Fund, the parents can transfer it to a Junior ISA to potentially benefit from lower fees or better choice. You should consult a financial advisor or the provider to discuss ISA transfers.
*As with all investing, financial instruments involve inherent risks, including loss of capital, market fluctuations and liquidity risk. Past performance is no guarantee of future results. It is important to consider your risk tolerance and investment objectives before proceeding.
