Junior ISAs

[luckyluckyluck3]

Hi there,
Anyone able to help, please?

I have two children. My Dad has been kindly putting £50/month into a Jr cash ISA for each child since they were born. They're 10 and 12.

My MiL has kindly decided she would like to give each child £9K/year (which I believe is the max) starting now.

Can they receive £9K minus my Dad's gift (so £8,400)? Or - if they were to have a Stocks and Shares ISA, could she contribute the full amount she would like?

Any advice or guidance gratefully received.

It's £9k max per child per year regardless of whether they have 1 or 2 Junior ISAs

Thank you. That's helpful.

Very lucky children!

Lucky children indeed but with those sums your MIL will need to think about both IHT implications if she dies within seven years of the gifts, and also about deprivation of assets if she's anywhere near needing care.

You didn't ask, but if she is determined to gift them the full £9k (or more!) she could also put up to £2,880 a year for each of them in a Junior SIPP. The SIPP provider will then claim back the tax relief on these contributions to top it up, so MIL's £2,880 becomes £3,600. It will then be locked away until your DCs are 57, under current rules, but invested wisely with compounding over 45+ years will become a sum that could make an enormous difference. Besides, what 12 year old doesn't want to talk about their pension in the playground?

Your MIL.can gift any of her money to anyone and the only reason to incur inheritance tax is if her whole estate is over the threshold (£325k per person plus an extra £175k if passing on main property to a child or grandchild) so £500k possibly. This can be transferred to a spouse meaning that the estate can have a tax free value of £1 million before tax is incurred.

And even if the estate did tip over the limit then the estate pays the IHT, which clearly has to have a good value by definition of being over the tax free limit.

Do discuss with your MIL get plans and thoughts, quite likely she is very aware of IHT and what he estate is worth.

If she's not, nows a good time to start getting her affairs sorted