Lifetime Individual Savings Accounts (ISAs)

What is a Lifetime ISA

It is an ISA that you can use to buy your first home or save for later life.

How much can I invest in an Lifetime ISA?

You can save up to £4,000 per year until you are 50. The Government will add a 25% bonus to your savings, up to a maximum of £1,000 per year.

The Lifetime ISA limit of £4,000 counts towards your annual ISA limit of £20,000 for the tax year 2022/23.

Age Restrictions

The Lifetime ISA is only available to those who are 18 or over and under 40 and are resident in the UK.

What can I hold in a Lifetime ISA?

You can hold cash, shares or a combination of both.

There is a 25% charge to withdraw cash or assets from a Lifetime ISA unless one of the following applies:

  • buying your first home
  • aged 60 or over
  • terminally ill, with less than 12 months to live

Buying your first home

You can use your Lifetime ISA savings to help you buy your first home if all of the following apply:

  • the property costs £450,000 or less
  • you buy the property at least 12 months after you open the Lifetime ISA
  • you use a conveyancer or solicitor to act for you in the purchase - the ISA provider will pay the funds directly to them
  • you’re buying with a mortgage
Buying with someone else

If the person you’re buying with has a Lifetime ISA, they can use their savings and government bonus too.

They’ll pay a 25% withdrawal charge to use their Lifetime ISA savings if they own or have a legal interest in property (for example they’re a beneficiary of a trust that includes property).

You can transfer money from a Help to Buy ISA to a Lifetime ISA. If you transfer money from a Lifetime ISA to a Help to Buy ISA you’ll have to pay the 25% withdrawal charge.

Saving for later life

You can take your savings out of a Lifetime ISA when you’re 60 or over.

You’ll pay a 25% charge if you withdraw money or transfer the Lifetime ISA to another type of ISA before 60.

If you die your Lifetime ISA ends on the date of your death. There’s no charge to withdraw the funds or assets from your account.