The £29,000 ISA Move Parents Are Missing

In the year a child turns 18, their family can put up to £29,000 into ISAs. More than in any other year of their life.

Here is how it works.

A Junior ISA lets you save up to £9,000 a year for a child, tax-free. When they turn 18, it automatically becomes a standard adult ISA, which has a separate allowance of £20,000 a year.

Most people assume the Junior ISA just converts to the £20,000 limit. What almost nobody realises is that in the year a child turns 18, both allowances count.

You can use the full £9,000 before their birthday, and then the full £20,000 from their birthday onwards. In one year, that is £29,000 saved tax-free.

Both are use-it-or-lose-it. Once 5 April passes, the window is gone for good.

The numbers

If a family put in the full £9,000 a year from birth, plus the full £29,000 in the year their child turns 18, total contributions would reach £182,000. At 7% average annual growth, that could be worth around £348,000 by the child’s 18th birthday, before charges and inflation.

If that same pot had been held outside an ISA, the tax bill on the gains could have been anywhere from £29,000 to £39,000, depending on the saver’s tax rate. Keeping it inside an ISA shelters all of that.

A few things worth knowing

Anyone can pay into a Junior ISA: parents, grandparents, other family members, friends. But the total from all sources cannot go above £9,000 in a year, so it is worth keeping track if multiple people are contributing.

From age 18, the money is entirely the child’s. They have full control over what it is spent on. Worth having that conversation as a family before the birthday arrives.
For grandparents thinking about their estate: gifts above £3,000 a year generally remain part of your estate for seven years for inheritance tax purposes. A financial adviser can help you think through the implications.

The £29,000 combined allowance applies in the current 2026/27 tax year, and is fixed until at least 2030.