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  • FIRST POST
    • MSE Helen Saxon
    • By MSE Helen Saxon 16th Mar 16, 5:06 PM
    • 75Posts
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    MSE Helen Saxon
    Lifetime ISAs guide
    • #1
    • 16th Mar 16, 5:06 PM
    Lifetime ISAs guide 16th Mar 16 at 5:06 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 42
    • Ed-1
    • By Ed-1 9th Jul 17, 8:55 PM
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    Ed-1
    I would assume it is HL that is at fault, as it was their decision to put £600 into my 'loyalty bonus' account (other account).

    - I have just looked back at this and there is actually £595 in that 'loyalty bonus' account. Someone is having a tinker. (The LISA account value has not changed)
    Originally posted by PeterTols
    Halifax will have provided the eligible amount to be put into the LISA without contributing to the LISA limit to HL.

    As for the other HL account's value changing - is it invested?
    • PeterTols
    • By PeterTols 9th Jul 17, 9:00 PM
    • 9 Posts
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    PeterTols
    Halifax will have provided the eligible amount to be put into the LISA without contributing to the LISA limit to HL.

    As for the other HL account's value changing - is it invested?
    Originally posted by Ed-1
    I will take your word for it (you're the one with 1000 thanks haha).

    The amount changing is not invested (yet). The £600 in the loyalty bonus account (I guess they had to put the £600 somewhere, so they put it there) has decreased to £595 for some unknown reason
    • PeterTols
    • By PeterTols 9th Jul 17, 9:02 PM
    • 9 Posts
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    PeterTols
    I figured out why it changed, I owe HL running costs, for the amount I have already invested! D'oh!
    • Ed-1
    • By Ed-1 9th Jul 17, 9:25 PM
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    Ed-1
    Part of me thinks that some potential Lifetime ISA providers are holding off launching in this transitional year to avoid having to faff about with the special rules applying in 2017/18 such as H2B ISA transfers (even though they don't have to accept them) and closing the LISA if there are any withdrawals this year.

    I wonder what would happen if someone transferred a H2B ISA to another provider and then transferred to LISA. There wouldn't be a balance on 5th April 2017 on the new H2B ISA even though there was on the old one. How would they work that one out?
    • PeterTols
    • By PeterTols 9th Jul 17, 9:42 PM
    • 9 Posts
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    PeterTols
    Part of me thinks that some potential Lifetime ISA providers are holding off launching in this transitional year to avoid having to faff about with the special rules applying in 2017/18 such as H2B ISA transfers (even though they don't have to accept them) and closing the LISA if there are any withdrawals this year.

    I wonder what would happen if someone transferred a H2B ISA to another provider and then transferred to LISA. There wouldn't be a balance on 5th April 2017 on the new H2B ISA even though there was on the old one. How would they work that one out?
    Originally posted by Ed-1
    Very possibly there is just so much to go wrong, let alone the amount of queries they would have to answer via phone/email.
    • jimbob0802
    • By jimbob0802 12th Jul 17, 2:13 PM
    • 17 Posts
    • 1 Thanks
    jimbob0802
    Clarification on my LISA's
    Okay, I'm sold on the LISA concept, even if I still find it confusing three months after opening one!

    To this end I've just read through the kind and got muddled up about this statement:

    "You can hold more than one LISA at any one time, provided that you only pay in to one at any time in each tax year (you can transfer the current year's money around, provided it's ALL transferred each time)."

    So, I opened up a LISA with Nutmeg on 6th April with £100, and it's doing swimmingly well (currently worth £102 )

    But, from the savings I had in my Nationwide, I transferred over £3000 to the Skipton Cash LISA when it opened!

    So, have I broken the rules?

    Just to complicate matters, I held back £850 cos was looking to use that to 'top-up' my Nutmeg portfolio, or set up a separate pot.

    Oh yeah and I have a H2B with Nationwide which I'm looking to transfer over in March 2018 to the Skipton one. If they let me! (Think I've got that part right!)

    Would really appreciate some clarification!

    p.s. just out of coincidence, today is my sister's birthday. No prizes to guess what her name is!!
    • eskbanker
    • By eskbanker 12th Jul 17, 2:27 PM
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    eskbanker
    So, I opened up a LISA with Nutmeg on 6th April with £100, and it's doing swimmingly well (currently worth £102 )

    But, from the savings I had in my Nationwide, I transferred over £3000 to the Skipton Cash LISA when it opened!

    So, have I broken the rules?
    Originally posted by jimbob0802
    Did you transfer money from a Nationwide ISA into the Skipton LISA, using Skipton's ISA transfer process?

    If so, then you're OK, but if you paid into Skipton using money from a non-ISA savings account then it isn't an ISA transfer and so breaches the rules, as you can only pay new money into one LISA in any given tax year.

    Edit: on reflection I think Ed-1 is right in post #829 that (even though it's now academic in this particular instance) this isn't OK after all!
    Last edited by eskbanker; 12-07-2017 at 6:42 PM. Reason: Corrected in subsequent post....
    • Ed-1
    • By Ed-1 12th Jul 17, 3:32 PM
    • 1,938 Posts
    • 1,034 Thanks
    Ed-1
    Okay, I'm sold on the LISA concept, even if I still find it confusing three months after opening one!

    To this end I've just read through the kind and got muddled up about this statement:

    "You can hold more than one LISA at any one time, provided that you only pay in to one at any time in each tax year (you can transfer the current year's money around, provided it's ALL transferred each time)."

    So, I opened up a LISA with Nutmeg on 6th April with £100, and it's doing swimmingly well (currently worth £102 )

    But, from the savings I had in my Nationwide, I transferred over £3000 to the Skipton Cash LISA when it opened!

    So, have I broken the rules?
    Originally posted by jimbob0802
    Yes - as you've identified, you can't pay into 2 LISAs in the same tax year but can transfer previous LISA money to another LISA. There's only been one LISA tax year so far (the current one) so no-one can currently have money in more than one LISA.
    • Ed-1
    • By Ed-1 12th Jul 17, 3:33 PM
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    Ed-1
    Did you transfer money from a Nationwide ISA into the Skipton LISA, using Skipton's ISA transfer process?

    If so, then you're OK, but if you paid into Skipton using money from a non-ISA savings account then it isn't an ISA transfer and so breaches the rules, as you can only pay new money into one LISA in any given tax year.
    Originally posted by eskbanker
    No it's not OK as they've paid into 2 LISAs in the same year. Old ISA money still counts as new LISA money if transferred into LISA.
    • jimbob0802
    • By jimbob0802 12th Jul 17, 4:13 PM
    • 17 Posts
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    jimbob0802
    Okay thanks for the replies but still confused. I'll be more comprehensive with what I did:

    In chronological order:

    1. I opened up a Stocks and Shares LISA with Nutmeg at the start of the tax year - to 'get the ball rolling', as Martin Lewis put it. I put £100 into it rather than the nominal £1.

    2. When Skipton released their Cash LISA, I opened one up. Soon after, I transferred £3000 of funds from my Nationwide Flexclusive ISA to my Nationwide Flexdirect Current Account. At that point, I paid in £3000 into my Skipton Cash LISA as a Debit Card payment (i.e. from the Flexdirect Current Account).

    That is the position I'm in. My goal all along has been to simply lock away £4000 of my savings into the LISA scheme, as to be eligible for the 25% bonus. As per the advice on MSE, I was going to transfer my Nationwide H2B ISA into a LISA in March of next year, as to keep the bonus I have on that at the moment (currently at £2200 and paying in £200 per month).

    If I have broken the rules as indicated above, what's the impact? Is there no way round it all so I can reach my goal? I certainly don't have anywhere near the maximum of £20k of savings that can be saved in ISA's this tax year.

    Thanks for your guidance: the LISA's seem overly bureaucratic for a mere laymen - I'm simply just a 30 something year old trying to get the most of out the little savings I have.
    • Ed-1
    • By Ed-1 12th Jul 17, 4:20 PM
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    Ed-1
    2. When Skipton released their Cash LISA, I opened one up. Soon after, I transferred £3000 of funds from my Nationwide Flexclusive ISA to my Nationwide Flexdirect Current Account. At that point, I paid in £3000 into my Skipton Cash LISA as a Debit Card payment (i.e. from the Flexdirect Current Account).
    Originally posted by jimbob0802
    This is when you broke the rules. There's no distinction between a stocks and shares LISA and a cash LISA like there is between a stocks and shares ISA and a cash ISA. You can pay into 1 each of the latter but only one LISA (whether it's cash or stocks and shares). You needed to transfer your Nutmeg LISA into Skipton so that you only paid into one LISA this tax year.

    Your second LISA is currently likely to be voided by HMRC at the end of the tax year. To avoid this, transfer the Nutmeg LISA into Skipton.
    • PerfectMess
    • By PerfectMess 12th Jul 17, 9:32 PM
    • 3 Posts
    • 1 Thanks
    PerfectMess
    LISA for retirement
    Not sure whether I should start a new thread as everyone is talking about buying houses but it's my first post here goes...
    I'm 25 a basic rate taxpayer, likely to stay that way through employment and definitely through retirement. I'm paying into my NHS pension CARE DB scheme so that will put me over the tax free threshold without considering that there will still be a state pension when I come to retire. I have bought a house.
    I have plenty (too much) cash as I only started investing after I bought my house.
    Now I am saving for early retirement/more likely to go part time, date is very flexible who knows what will happen next year so I'm starting now with a view that I can pause payments as and when in the future.
    I started a stakeholder pension, nearly two years ago, now paying in £150/month reluctant to increase (I don't think it's quite what I wanted and I was going to move it but it's doing better than I expected so I'll keep it for now), I also have a S&S ISA ~£500/month now.
    So I'm now looking at LISA as another pot... tax relief same as pension going in but tax free coming out. I have to wait until at least 58? I think for pension so only an extra two years to the LISA and ~state pension age for NHS pension but I will have plenty S&S ISA hopefully to fund any gaps or extra years.
    Does this seem correct? Everyone is saying LISAs are great for houses which I agree but they aren't saying they're good for retirement?
    I think AJ Bell would be a good option for me with their low fees £1.50 to deal so I would be buying and holding it's for the long term in a LISA anyway so invest £4000 wait for bonus and invest £1000+4000 in one transaction and so on keeping some cash to cover fees?
    • PerfectMess
    • By PerfectMess 12th Jul 17, 9:45 PM
    • 3 Posts
    • 1 Thanks
    PerfectMess
    1. I opened up a Stocks and Shares LISA with Nutmeg at the start of the tax year - to 'get the ball rolling', as Martin Lewis put it. I put £100 into it rather than the nominal £1.

    2. When Skipton released their Cash LISA, I opened one up. Soon after, I transferred £3000 of funds from my Nationwide Flexclusive ISA to my Nationwide Flexdirect Current Account. At that point, I paid in £3000 into my Skipton Cash LISA as a Debit Card payment (i.e. from the Flexdirect Current Account).

    That is the position I'm in. My goal all along has been to simply lock away £4000 of my savings into the LISA scheme, as to be eligible for the 25% bonus. As per the advice on MSE, I was going to transfer my Nationwide H2B ISA into a LISA in March of next year, as to keep the bonus I have on that at the moment (currently at £2200 and paying in £200 per month).
    Originally posted by jimbob0802
    I know this is only my second post but from reading this thread your HTB and LISA contributions this tax year can only equal £4000 so you can't put £4000 (or £3100) into your LISA and 200/month into HTB. Your LISA can only have £4000 - £2400 (12x200) if you were to carry on all HTB payments this tax year.
    • Ed-1
    • By Ed-1 12th Jul 17, 10:18 PM
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    Ed-1
    I know this is only my second post but from reading this thread your HTB and LISA contributions this tax year can only equal £4000 so you can't put £4000 (or £3100) into your LISA and 200/month into HTB. Your LISA can only have £4000 - £2400 (12x200) if you were to carry on all HTB payments this tax year.
    Originally posted by PerfectMess
    Good point - they'd only be able to transfer a maximum of H2B ISA contributions made before 6th April 2017 + £900 post-6th April contributions - any interest from after 6th April 2017.
    Last edited by Ed-1; 13-07-2017 at 8:21 AM.
    • jimbob0802
    • By jimbob0802 12th Jul 17, 11:53 PM
    • 17 Posts
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    jimbob0802
    This is when you broke the rules. There's no distinction between a stocks and shares LISA and a cash LISA like there is between a stocks and shares ISA and a cash ISA. You can pay into 1 each of the latter but only one LISA (whether it's cash or stocks and shares). You needed to transfer your Nutmeg LISA into Skipton so that you only paid into one LISA this tax year.

    Your second LISA is currently likely to be voided by HMRC at the end of the tax year. To avoid this, transfer the Nutmeg LISA into Skipton.
    Originally posted by Ed-1
    Hi Ed....sorry to keep beating on about this, but I trust your knowledge on this.

    With that in mind, would it be more prudent to do this asap, and just get my £4k into the Skipton Cash LISA (preferable I guess, as I'm a low risk sort of guy)?

    Also, do I need to fess up to HMRC, or will they just see what LISA's I have open at the end of the tax year? (Hence, if I close the Nutmeg a/c, I should be okay right?)

    Finally...if I have saved £2400 in my H2B, and transfer it into the LISA in March 2018 (hopefully), does this mean that I only really have to have £1600 in my Cash LISA to ensure the eventuality of me having £4k, and therefore the 25% bonus, plus the full bonus amount on my H2B for this tax year?

    I owe you one for the advice, much appreciated!
    • Ed-1
    • By Ed-1 13th Jul 17, 8:36 AM
    • 1,938 Posts
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    Ed-1
    Hi Ed....sorry to keep beating on about this, but I trust your knowledge on this.

    With that in mind, would it be more prudent to do this asap, and just get my £4k into the Skipton Cash LISA (preferable I guess, as I'm a low risk sort of guy)?

    Also, do I need to fess up to HMRC, or will they just see what LISA's I have open at the end of the tax year? (Hence, if I close the Nutmeg a/c, I should be okay right?)

    Finally...if I have saved £2400 in my H2B, and transfer it into the LISA in March 2018 (hopefully), does this mean that I only really have to have £1600 in my Cash LISA to ensure the eventuality of me having £4k, and therefore the 25% bonus, plus the full bonus amount on my H2B for this tax year?

    I owe you one for the advice, much appreciated!
    Originally posted by jimbob0802
    How long have you been paying into your H2B ISA? Anything paid in before 6th April 2017 can be transferred in addition to the £4k LISA limit. Anything paid in from 6th April reduces the amount you can pay into the LISA so if you'll have paid £2,200 into the H2B by next March and you've already paid £3,100 into the LISA this year, you won't be able to transfer all of the H2B ISA across to LISA. If you tried to transfer it all Skipton would likely return the excess to you by cheque or reject the transfer.

    You could start afresh and close both LISAs given there are no withdrawal charges this year but you must close the LISA if you withdraw anything.

    You could then start again (although it would reset the 12 month clock if that's a problem).

    LISAs that have been transferred mid-year aren't reported to HMRC.
    • jimbob0802
    • By jimbob0802 13th Jul 17, 4:51 PM
    • 17 Posts
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    jimbob0802
    How long have you been paying into your H2B ISA? Anything paid in before 6th April 2017 can be transferred in addition to the £4k LISA limit. Anything paid in from 6th April reduces the amount you can pay into the LISA so if you'll have paid £2,200 into the H2B by next March and you've already paid £3,100 into the LISA this year, you won't be able to transfer all of the H2B ISA across to LISA. If you tried to transfer it all Skipton would likely return the excess to you by cheque or reject the transfer.

    You could start afresh and close both LISAs given there are no withdrawal charges this year but you must close the LISA if you withdraw anything.

    You could then start again (although it would reset the 12 month clock if that's a problem).

    LISAs that have been transferred mid-year aren't reported to HMRC.
    Originally posted by Ed-1
    Okay. Think I've got it.

    I only had £1600 in the H2B from 2016-17 so I assume from what you're saying, this is the amount I can transfer in above the £4000 LISA limit. (Or alternatively, transfer in the whole £4000 that will be in there (ironically) come March 2018 - assuming that Skipton accepts the transfer (some conjecture about that according to MSE)

    I would prefer to play it safe with my savings so favour the Cash LISA as opposed to the Stocks and Shares LISA. The clock however, is not important seen as there is zero chance I will be buying a property anytime soon (I am 100% certain about this).

    So, think I'll close both LISA's and start again with Skipton by transferring in the H2B money straight away and then topping it up to the...£5600 that I will be able to have in it? (i.e. the £1600 H2B money plus £4000 new LISA money?) Think this is right...right?!
    • Ed-1
    • By Ed-1 13th Jul 17, 5:12 PM
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    Ed-1
    Okay. Think I've got it.

    I only had £1600 in the H2B from 2016-17 so I assume from what you're saying, this is the amount I can transfer in above the £4000 LISA limit. (Or alternatively, transfer in the whole £4000 that will be in there (ironically) come March 2018 - assuming that Skipton accepts the transfer (some conjecture about that according to MSE)

    I would prefer to play it safe with my savings so favour the Cash LISA as opposed to the Stocks and Shares LISA. The clock however, is not important seen as there is zero chance I will be buying a property anytime soon (I am 100% certain about this).

    So, think I'll close both LISA's and start again with Skipton by transferring in the H2B money straight away and then topping it up to the...£5600 that I will be able to have in it? (i.e. the £1600 H2B money plus £4000 new LISA money?) Think this is right...right?!
    Originally posted by jimbob0802
    Yes that's a plan
    • Mattmuzz
    • By Mattmuzz 15th Jul 17, 10:26 AM
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    Mattmuzz
    Hello,


    Just a quick one..


    I opened the cash LISA in June with Skipton, does the bonus pay on the year anniversary or does it still pay at the end of the tax year?
    • badger09
    • By badger09 15th Jul 17, 12:03 PM
    • 5,112 Posts
    • 4,324 Thanks
    badger09
    Hello,


    Just a quick one..


    I opened the cash LISA in June with Skipton, does the bonus pay on the year anniversary or does it still pay at the end of the tax year?
    Originally posted by Mattmuzz
    Late April/early May 2018
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