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  • FIRST POST
    • MSE Helen Saxon
    • By MSE Helen Saxon 16th Mar 16, 4:06 PM
    • 73Posts
    • 39Thanks
    MSE Helen Saxon
    Lifetime ISAs guide
    • #1
    • 16th Mar 16, 4:06 PM
    Lifetime ISAs guide 16th Mar 16 at 4:06 PM
    Hi!

    This is the discussion thread for the



    Click reply below to discuss. If you haven’t already, join the forum to reply. If you aren’t sure how it all works, read our New to Forum? Intro Guide.


    Thanks folks,
Page 17
    • masonic
    • By masonic 27th Mar 17, 5:33 AM
    • 8,810 Posts
    • 5,925 Thanks
    masonic
    No you're not understanding me correctly. You're over-complicating it even though I could have expressed it more elegently.

    Basically my interpretation which must be the right one is your number 2. All interest accrued/paid at the point of clisure/transfer of the H2B ISA is not treated as a new subscription and therefore should not count against the LISA limit.
    Originally posted by Ed-1
    Ok, good. That's what I want the answer to be and what it seems it should be based on the general principles of ISA transfers.
    • dombox
    • By dombox 27th Mar 17, 12:24 PM
    • 7 Posts
    • 0 Thanks
    dombox
    Can anyone help me with a Q on the Year 2 allowance,

    if i put 4k in LISA in Fy17-18 then in the first month of Fy18/19 (i.e April 2018) put in another 4k.

    Can i purchase a house in May using the £8k I've put in and get 25% contribution OR will i have to wait until the end fy18/19 to get the 25% on the year 2 allowance?

    Also i'm keen to get the clock ticking and want to start a LISA the day it comes out but i notice there is only stocks and shares, whats the best way of doing this with teh minimum investment? If i open a stocks and shares LISA can i then transfer it into a cash lifetime ISA?
    • Ed-1
    • By Ed-1 27th Mar 17, 12:30 PM
    • 1,641 Posts
    • 885 Thanks
    Ed-1
    Can anyone help me with a Q on the Year 2 allowance,

    if i put 4k in LISA in Fy17-18 then in the first month of Fy18/19 (i.e April 2018) put in another 4k.

    Can i purchase a house in May using the £8k I've put in and get 25% contribution OR will i have to wait until the end fy18/19 to get the 25% on the year 2 allowance?

    Also i'm keen to get the clock ticking and want to start a LISA the day it comes out but i notice there is only stocks and shares, whats the best way of doing this with teh minimum investment? If i open a stocks and shares LISA can i then transfer it into a cash lifetime ISA?
    Originally posted by dombox
    Bonuses will be paid monthly from April 2018 onwards. Yes, you can transfer between any two LISAs but you may find that one savings provider is ready to go on 6th April.
    • mrRobot
    • By mrRobot 27th Mar 17, 4:23 PM
    • 4 Posts
    • 0 Thanks
    mrRobot
    I wonder if any can help, at the moment i've got a Help to Buy ISA which I opened as soon as they came out, now, I've read Martins guide about what to do, but I dont think I fit in any of the points. I plan to buy this time next year.

    So, I have a Help to Buy ISA with the max amount you can have in it up to now.

    I'm think of opening a LISA as you can save more in it - £4000 max

    If I open a LISA and still keep topping up my HTB isa until next March 2018, am I right in thinking I could have max amount in my HTB isa and transfer it into my LISA as it doesnt contribute to the LISA limit? So i could have £4k LISA + around 6K from HTB? so nearly £10k?
    • masonic
    • By masonic 27th Mar 17, 4:37 PM
    • 8,810 Posts
    • 5,925 Thanks
    masonic
    If I open a LISA and still keep topping up my HTB isa until next March 2018, am I right in thinking I could have max amount in my HTB isa and transfer it into my LISA as it doesnt contribute to the LISA limit? So i could have £4k LISA + around 6K from HTB? so nearly £10k?
    Originally posted by mrRobot
    Anything you pay into your HTB ISA after 5th April will come out of your £4k LISA allowance when you transfer it.
    • bowlhead99
    • By bowlhead99 27th Mar 17, 4:40 PM
    • 5,990 Posts
    • 10,536 Thanks
    bowlhead99
    You can have the HTB balance you've already got at the end of this tax year (transferred into the LISA) and you can do £4000 extra into the LISA in 2017/18... whether it was added to a HTB or other type of ISA during 2017/18 and transferred over to the LISA, *or* paid direct to the LISA from your bank. So essentially you can have what you have in the HTB at 5-April 2017 plus £4k of new contributions.

    What you can't have is whatever you have in the ISA at 5 April 2017 and £4k of new direct contributions in 16/17 *and* another £2400 of new HTB ISA contributions transferred in. If you are going to make ongoing contributions until the HTB I the new tax year and transfer them over, you will have to restrict what you put into the LISA by other means, to avoid getting over £4k of new contributions in the LISA on top the of the 5/4/2016 HTB balance.
    • Nasqueron
    • By Nasqueron 27th Mar 17, 6:03 PM
    • 3,944 Posts
    • 2,178 Thanks
    Nasqueron
    Sorry if this is a dumb question but is there anything to stop you having both the LISA and pension contributions?

    I currently have a stakeholder pension which I have had just over 11 years (I pay around £102 a month, it rises each year with inflation ~ £209 a month estimated income at 65) + workplace pension (5% salary matched ~ £176 a month at 65).

    I am moving jobs and the new place only has the government scheme which I will pay as much in as I can and makes sense for me to move the funds from the old scheme into another so I pay less in the way of charges) but does give a decent pay rise.

    I was contemplating paying more into the stakeholder and opening a LISA as a savings fund to help at 60 while I work towards retirement. I am a lower rate tax payer if that helps
    • bowlhead99
    • By bowlhead99 27th Mar 17, 6:27 PM
    • 5,990 Posts
    • 10,536 Thanks
    bowlhead99
    Sorry if this is a dumb question but is there anything to stop you having both the LISA and pension contributions?
    Originally posted by Nasqueron
    No
    [Obligatory extra text to meet minimum post length requirements]
    • Tom_Hendo
    • By Tom_Hendo 28th Mar 17, 8:31 AM
    • 4 Posts
    • 0 Thanks
    Tom_Hendo
    Any banks offering yet?
    I am getting slightly nervous that Year End, and the start of this account, is only 9 days away, and I have yet to see an offering from one of the major banks. Do we have any information on this, or do we expect very last minute decisions from these competitors?
    • eskbanker
    • By eskbanker 28th Mar 17, 12:40 PM
    • 3,988 Posts
    • 3,703 Thanks
    eskbanker
    I am getting slightly nervous that Year End, and the start of this account, is only 9 days away, and I have yet to see an offering from one of the major banks. Do we have any information on this, or do we expect very last minute decisions from these competitors?
    Originally posted by Tom_Hendo
    MSE say they'll update http://www.moneysavingexpert.com/savings/lifetime-ISAs#bestbuys once there's something to report but so far it's only Skipton who've said they'll launch and even then it won't be until June. As I understand it, the fine detail of the rules has only been confirmed very recently so it seems unlikely that anyone will be wading in at the last minute if a small player is going to take three months to be ready.

    Having said that, the major banks have deeper pockets and may be able and willing to throw resources at it to expedite a launch, but personally I wouldn't expect any cash LISA offerings to be available on 6 April....
    • Tom_Hendo
    • By Tom_Hendo 28th Mar 17, 1:28 PM
    • 4 Posts
    • 0 Thanks
    Tom_Hendo
    It makes sense I suppose, basically the government has shot itself in the foot trying to make this an amazing thing from 06/04, by not finalising anything.

    From a consumer who jsut wants to use it to buy his first house, I presume the better option would be to stop any funds going into my HTB from now (The current amount can be transfered as per the rules) and save up towards the £4k to put in either when I open the account, or just before April 2018 (if the rates are dire now)
    • zsolmanz
    • By zsolmanz 28th Mar 17, 4:36 PM
    • 3 Posts
    • 2 Thanks
    zsolmanz
    DON'T stop your H2B contributions until March 2018 or you are certain you'll be using a LISA to buy your house (whichever is sooner).
    If you are continuing to save the £4k in expectation of opening a LISA, you should save £2.4k of it in your H2B ISA:
    If you don't open the LISA, you'll have more in your H2B and hence more bonus. If you do open one, you can still transfer the entirety of your H2B into the LISA and make a further £1.6k in contributions for that year (2.4k+1.6k = 4k).
    • masonic
    • By masonic 28th Mar 17, 5:56 PM
    • 8,810 Posts
    • 5,925 Thanks
    masonic
    No you're not understanding me correctly. You're over-complicating it even though I could have expressed it more elegently.

    Basically my interpretation which must be the right one is your number 2. All interest accrued/paid at the point of clisure/transfer of the H2B ISA is not treated as a new subscription and therefore should not count against the LISA limit.
    Originally posted by Ed-1
    The description of this in the updated ISA Guidance Notes seems to be much clearer:

    9B.16
    During 2017/18 tax year only, investors who are eligible to open a Lifetime ISA may make a single transfer of funds (including interest) up to the value built up in their Help to Buy: ISA as at 5 April 2017 into a Lifetime ISA, without this amount counting towards the £4,000 Lifetime ISA payment limit.
    • -/chris-/
    • By -/chris-/ 28th Mar 17, 8:36 PM
    • 329 Posts
    • 1,427 Thanks
    -/chris-/
    Transferring Isa's into a LISA
    Hi, hope someone can help me, I've tried reading up about the above but I keep getting confused, so here goes.......

    I currently have a cash ISA with Santander and a help to buy ISA with halifax. Would it be possible to transfer both of the above to a LISA before the new tax year on the 6th April? After the 5th April would I still be able to contribute to the 4K limit in the new tax year?

    I'm wanting the LISA to go towards a house purchase, not bothered about the stocks and shares part of it. As there are no providers offering cash LISA's until June, providing I could transfer both of the above, would I just transfer them to a stocks and shares LISA temporarily?

    Thanks

    Chris
    • Ed-1
    • By Ed-1 28th Mar 17, 9:13 PM
    • 1,641 Posts
    • 885 Thanks
    Ed-1
    Hi, hope someone can help me, I've tried reading up about the above but I keep getting confused, so here goes.......

    I currently have a cash ISA with Santander and a help to buy ISA with halifax. Would it be possible to transfer both of the above to a LISA before the new tax year on the 6th April? After the 5th April would I still be able to contribute to the 4K limit in the new tax year?

    I'm wanting the LISA to go towards a house purchase, not bothered about the stocks and shares part of it. As there are no providers offering cash LISA's until June, providing I could transfer both of the above, would I just transfer them to a stocks and shares LISA temporarily?

    Thanks

    Chris
    Originally posted by -/chris-/
    Assuming you mean before the new tax year starting 6th April 2018 (as LISAs don't launch until 6th April 2017), you can:
    • transfer the H2B balance either in full or just subscriptions made before 6th April 2017 to a LISA in tax year 2017/18 without it reducing the LISA limit of £4,000;
    • add £4,000 of further subcriptions to the LISA during tax year 2017/18.
    • Anything you transfer from the cash ISA or subscriptions from the H2B ISA made after 6th April 2017 will reduce the £4,000 LISA limit by the amount transferred.
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