Lifetime ISAs guide
Comments
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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).0 -
The description of this in the updated ISA Guidance Notes seems to be much clearer: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.
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.
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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
Chris0 -
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
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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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.
Thanks, so just to clarify...
I have until the 5th April to transfer both of my ISA products. Do I choose a stocks and shares LISA to begin with and then move it across to the Skipton building society when they launch the cash LISA in June?0 -
- You can't transfer anything to any LISA before 5 April 2017 because LISAs don't exist until 6 April 2017 at the very earliest.Thanks, so just to clarify...
I have until the 5th April to transfer both of my ISA products.
-You have until 5 April *2018* to transfer your HTB ISA that contains 'tax year 2015/16 and earlier' money and not have that 'tax year 2015/16 and earlier' money ever count against the £4000 per year limit for LISA contributions.
- All of the money added to a HTB ISA on or after 6 April 2017 and later transferred to a LISA will count towards the £4000 LISA contribution limit of the tax year in which it's transferred to the LISA
- Whenever you transfer money from a non-HTB ISA into a LISA it will count against the £4000 LISA contribution limit of the tax year in which it's transferred to the LISA, no matter when the original subscriptions to the non-HTB ISA were made. So if you have money in another Cash ISA at the moment, you can transfer some or all of it into the LISA during 2017/18 (if you have space within the £4000 annual limit), or in the year after, or the year after that etc depending on when you have space and which interest rate is better for you.
The only reason to choose a stocks and shares LISA first is if you want to start the clock ticking on the 12-month minimum time that your LISA must be open before you are allowed to take a withdrawal of the money including bonus. If you are not going to buy a property before, say, July 2018, there is no particular reason to open up a S&S LISA in April 2017 that you don't even want. You could just wait until Skipton or someone else opens their cash ISA in June 2017.Do I choose a stocks and shares LISA to begin with and then move it across to the Skipton building society when they launch the cash LISA in June?
If you open a S&S LISA and later transfer its contents to a cash LISA, the start date for the cash LISA is considered to be the date you first subscribed to the earlier product (for the purposes of counting the 12 months before penalty-free withdrawal to buy property). However, going that route may involve minimum subscription amounts with potential investment losses, or account closure fees / transfer out fees from the S&S LISA provider, so don't do it if you don't need to.0 -
I do plan to buy a house before July 2018 so i want to get the clock ticking ASAP. Does anyone know what the minimum investment is with any of the LISA providers offering Shares and Stock options.0
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I am planning on buying a house in May 2018.. I currently have a H2B, and will transfer to a LISA on the 6th April 17. A few questions..
1) When I finally transfer the H2B into a LISA, will the 25% bonus from the H2B be added into my LISA?
2) Is this the best method? Open a S&S LISA and put in £1800. Keep paying £200 monthly into H2B until March 2018 (will have added £2200), then transfer the H2B to the LISA before the end of the 17/18 tax year?
3) If I was to pay in another 4K into the LISA on April 6th 2018 and wait a month, will I get 25% on this 4K too or have I got to wait a full year?0 -
Yes1) When I finally transfer the H2B into a LISA, will the 25% bonus from the H2B be added into my LISA?
It would be best to open the LISA with the minimum balance allowed, then top it up towards the end of the tax year. Keep the cash in an account paying the best available rate until then.2) Is this the best method? Open a S&S LISA and put in £1800. Keep paying £200 monthly into H2B until March 2018 (will have added £2200), then transfer the H2B to the LISA before the end of the 17/18 tax year?
You should receive it the following month.3) If I was to pay in another 4K into the LISA on April 6th 2018 and wait a month, will I get 25% on this 4K too or have I got to wait a full year?0 -
So much for being able to open a LISA for £1 to start with! Nutmeg want minimum £500 to open the account. I can't seem to find this info for Hargreaves Lansdown, or The Share Centre..
This negates the good advice on here about LISAs.
Any advice?0
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