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  • FIRST POST
    • MSE Helen Saxon
    • By MSE Helen Saxon 16th Mar 16, 5:06 PM
    • 75Posts
    • 44Thanks
    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 havenít already, join the forum to reply. If you arenít sure how it all works, read our New to Forum? Intro Guide.


    Thanks folks,
Page 58
    • DanielleJH
    • By DanielleJH 8th Jan 18, 9:37 PM
    • 7 Posts
    • 0 Thanks
    DanielleJH
    Hoping someone can help clarify the LISA for me. My husband and I are both first time buyers who have held LISAs since September 2016. Am I definitely right in thinking we're entitled to £4000 each per tax year?

    We are hoping to buy in January 2019 so will have held the accounts over two tax years. Does this mean we are able to save a maximum of £16000 between us with a maximum bonus of £4000 before April next year? We only have a few £100 each in them so far but are due bonuses in work before the end of April so hoping to get as close to £4000 each as possible.
    • Ed-1
    • By Ed-1 8th Jan 18, 9:40 PM
    • 2,000 Posts
    • 1,113 Thanks
    Ed-1
    Hoping someone can help clarify the LISA for me. My husband and I are both first time buyers who have held LISAs since September 2016. Am I definitely right in thinking we're entitled to £4000 each per tax year?

    We are hoping to buy in January 2019 so will have held the accounts over two tax years. Does this mean we are able to save a maximum of £16000 between us with a maximum bonus of £4000 before April next year? We only have a few £100 each in them so far but are due bonuses in work before the end of April so hoping to get as close to £4000 each as possible.
    Originally posted by DanielleJH
    Yes........
    • Alexland
    • By Alexland 8th Jan 18, 10:26 PM
    • 1,125 Posts
    • 755 Thanks
    Alexland
    The tax year ends on 5th of April so if your bonuses are due towards the end of April that could mean you have a very low contribution this tax year. Is it worth doing some low cost financial engineering to get some more money in this tax year?
    Last edited by Alexland; 08-01-2018 at 10:28 PM.
    • AlphaSatsuma
    • By AlphaSatsuma 9th Jan 18, 1:17 AM
    • 11 Posts
    • 227 Thanks
    AlphaSatsuma
    You can only pay into one Lifetime ISA per tax year. You could either close the Nutmeg LISA (there's no charge for 2017/18 only) and then pay into a Skipton LISA or if you want to keep the original opening date, you can transfer the Nutmeg LISA into a Skipton LISA.

    You can't pay into both Nutmeg and Skipton LISAs in the same tax year.
    Originally posted by Ed-1
    I did see that you are only supposed to be allowed to pay into one a year, which itself is a stupid rule, especially given the situation I find myself in.
    So I found on the Nutmeg website that they were planning on doing transfers but have decided against it. They have suggested that transfers are allowed (in case anyone else is in a similar position):
    https://www.nutmeg.com/lifetime-isa/help-to-buy-transfers

    I think to make sure everything is above board what I should do is pay in the maximum amount to my nutmeg LISA, transfer it to Skipton (only payed into one then), arrange the transfer of H2B, decide whether to transfer back to nutmeg...
    Not sure yet how I do this, or even if Skipton will allow it...
    • Alexland
    • By Alexland 9th Jan 18, 1:18 PM
    • 1,125 Posts
    • 755 Thanks
    Alexland
    If you want to continue investing your LISA in the markets (presumably because you are not planning to buy property for a long time, you like taking risks or are now planning to use it for retirement) then why not open a LISA with HL and transfer both your Nutmeg LISA and HTB ISA in? As part of the transfer both providers will tell HL the amount contributed this year (it doesn't really matter if Halifax get the HTB interest wrong) so HL will then be able to tell you how much more you can contribute. The HL customer service is excellent and the fees similar to Nutmeg.

    The downsides to HL are choosing a fund (Vanguard LifeStrategy series is similar to Nutmeg fixed portfolios), keeping track of the cash balance to pay platform fees and the exit fee at the end - if the FCA still allow them to charge it. The upside to HL is that if the value gets really big you can cap your platform charges by investing in ETFs.

    Alex.
    Last edited by Alexland; 09-01-2018 at 1:24 PM.
    • DanielleJH
    • By DanielleJH 9th Jan 18, 6:01 PM
    • 7 Posts
    • 0 Thanks
    DanielleJH
    The tax year ends on 5th of April so if your bonuses are due towards the end of April that could mean you have a very low contribution this tax year. Is it worth doing some low cost financial engineering to get some more money in this tax year?
    Originally posted by Alexland
    Our bonuses are paid in February so we're quite lucky. It won't be confirmed how much for a few weeks yet though so fingers crossed.
    • marmitemum
    • By marmitemum 10th Jan 18, 3:09 PM
    • 12 Posts
    • 3 Thanks
    marmitemum
    H2b/lisa
    My daughter and future son in law each opened an H2B in the 2016-17 tax year. They then each opened a LISA with Skipton after 5th April, transferred their H2Bs (£1200 value) into their LISAs and have been continuing to save further.

    Have I understood things correctly - that the H2B money does not count towards the £4,000 annual LISA limit? Will they get the government bonus on that as well?

    They are intending leaving it all there for another year and buying in 2019.

    Thanks!
    • Ed-1
    • By Ed-1 10th Jan 18, 3:41 PM
    • 2,000 Posts
    • 1,113 Thanks
    Ed-1
    My daughter and future son in law each opened an H2B in the 2016-17 tax year. They then each opened a LISA with Skipton after 5th April, transferred their H2Bs (£1200 value) into their LISAs and have been continuing to save further.

    Have I understood things correctly - that the H2B money does not count towards the £4,000 annual LISA limit? Will they get the government bonus on that as well?

    They are intending leaving it all there for another year and buying in 2019.

    Thanks!
    Originally posted by marmitemum
    It's the balance on the H2B ISA (plus accrued interest) on 5th April 2017 that doesn't count towards the £4k LISA limit if it's transferred in the 2017/18 tax year.
    • marmitemum
    • By marmitemum 10th Jan 18, 6:21 PM
    • 12 Posts
    • 3 Thanks
    marmitemum
    Thank you - so does this mean that they could potentially earn the 25% government bonus on BOTH the 2016/7 H2B £1200 transferred in 2017/8 AND £4000 saved by DD in 2017/8 before 5/4/18, ie on a total of £5200, so £1300?
    • Ed-1
    • By Ed-1 10th Jan 18, 7:15 PM
    • 2,000 Posts
    • 1,113 Thanks
    Ed-1
    Thank you - so does this mean that they could potentially earn the 25% government bonus on BOTH the 2016/7 H2B £1200 transferred in 2017/8 AND £4000 saved by DD in 2017/8 before 5/4/18, ie on a total of £5200, so £1300?
    Originally posted by marmitemum
    Yes........
    • playz28
    • By playz28 10th Jan 18, 8:30 PM
    • 2 Posts
    • 3 Thanks
    playz28
    Just wanted to share my experience of the Help to Buy ISA transfer I did from Halifax to Hargreaves Lansdown LISA.

    1) The whole process took 8 working days from when I posted the form on the 27th Dec 17. Timeline: 27/12/17 Ė form posted; 03/01/18 Ė HTB ISA closed; 05/01/18 HTB ISA transferred (Hargreaves refer to this as the trade date); 09/01/18 HTB ISA transfer complete (Hargreaves refer to this as the settle date).

    2) Halifax have now closed my Help to Buy ISA. I have not specifically asked for them to close it, however it seems they close it automatically when the transfer is made, I requested a full balance transfer on the Hargreaves form. This is contrary to some in this forum who have done a partial transfer to Skipton and managed to keep their HTB ISA open. There is no section on the Hargreaves transfer form which states the transfer in account should be closed.

    3) Interest accrued after 5th April 17 does not contribute towards the 2017/2018 £4,000 LISA allowance.

    4) Gross Interest accrued from yearly payment date (in my case 1st Dec 17) and 1 day before account closure date (3rd Jan 17) is paid with the balance transfer.

    Using the above as a proxy, if I had transferred my HTB ISA later on the 1st March 18 I would have earned an extra £11.71 of interest. Not the biggest of deals but every little helps. In any case I wanted to get the transfer instigated early so there were no issues.

    I am keeping my transfer in cash within the Hargreaves LISA. I plan to buy this year so not worried that they pay no interest on the funds.
    Last edited by playz28; 10-01-2018 at 8:32 PM.
    • jacktatts
    • By jacktatts 10th Jan 18, 9:25 PM
    • 1 Posts
    • 0 Thanks
    jacktatts
    Help with LISA rates.
    Hi all,
    So i have recently (this week) taken out a cash LISA with Skipton with plans to save for and buy a house in 3 - 4 years time.
    Now, my plan is to contribute £4,000 only each tax year to gain the £1000 bonus. I have more money to save and plan to the rest into a regular savings account which has a higher interest rate.

    In this scenario i'm not sure which would be more efficient -
    1) front load the £4000 into the LISA as quick as possible and then start contributing to the regular saver (repeat each tax year).
    2) split the £4000 across the tax year (£333.33 / month, off the top off my head), and contribute the rest to the regular saver from day1.

    Side note - if i manage to get £4000 into my LISA between now and April (unlikely), would i get the £1000 bonus for this tax year?

    Thanks in advance for any help
    • Badonde89
    • By Badonde89 10th Jan 18, 10:06 PM
    • 1 Posts
    • 0 Thanks
    Badonde89
    Hi guys, quick question:
    I opened a nutmeg Lisa, planning to transfer my htb ISA into it. Of course, they let us down so I ended up transferring over to Skipton (completed) and am in the process of transferring the htb over, should be completed in next couple of days.
    I am slightly worried I've done things the wrong way round for the Lisa allowance.

    I've made no htb contributions this tax year. I initially started the nutmeg account with £600. This is now transferred into Skipton. Am I going to be allowed to top up the remaining £3400 allowance into Skipton?
    Asking because I've now seen you're only allowed to contribute to one Lisa per year.
    Is this true even if you've transferred and closed the original account?
    Thanks!
    • Alexland
    • By Alexland 10th Jan 18, 10:22 PM
    • 1,125 Posts
    • 755 Thanks
    Alexland
    In this scenario i'm not sure which would be more efficient -
    1) front load the £4000 into the LISA as quick as possible and then start contributing to the regular saver (repeat each tax year).
    2) split the £4000 across the tax year (£333.33 / month, off the top off my head), and contribute the rest to the regular saver from day1.
    Originally posted by jacktatts
    If you can earn better interest elsewhere then it would make sense to make the LISA contribution towards the end of each tax year. But not so late that any delay in processing the transaction would risk the bonus for the year. Your situation is simpler than others as you are contributing cash not trying to transfer an existing HTB ISA etc.

    Side note - if i manage to get £4000 into my LISA between now and April (unlikely), would i get the £1000 bonus for this tax year?
    Originally posted by jacktatts
    Yes if you get the money in by 5th April you would get the full 25% bonus added in April or May.

    Are you sure there is no financial engineering you can do to enable this? If you definitely have more income than you will be allowed to contribute in future years would it be worth using a short term loan, defer normal spending using an interest free credit card, etc. Obviously only borrow what you can clearly afford to repay as I wouldn't suggest taking risks or paying high interest to fill your LISA this year. Don't do anything to risk your credit rating for when applying for a mortgage but a responsible quickly repaid loan should be ok.

    Alex
    Last edited by Alexland; 11-01-2018 at 6:42 AM.
    • Alexland
    • By Alexland 10th Jan 18, 10:38 PM
    • 1,125 Posts
    • 755 Thanks
    Alexland
    Hi guys, quick question:
    I opened a nutmeg Lisa, planning to transfer my htb ISA into it. Of course, they let us down so I ended up transferring over to Skipton (completed) and am in the process of transferring the htb over, should be completed in next couple of days.
    I am slightly worried I've done things the wrong way round for the Lisa allowance.

    I've made no htb contributions this tax year. I initially started the nutmeg account with £600. This is now transferred into Skipton. Am I going to be allowed to top up the remaining £3400 allowance into Skipton?
    Asking because I've now seen you're only allowed to contribute to one Lisa per year.
    Is this true even if you've transferred and closed the original account?
    Thanks!
    Originally posted by Badonde89
    From an HMRC perspective it's the same LISA you are just changing provider by transfering it. You should be able to use your remaining LISA allowance with your new provider.
    • eskbanker
    • By eskbanker 11th Jan 18, 12:25 AM
    • 6,082 Posts
    • 6,110 Thanks
    eskbanker
    3) Interest accrued after 5th April 17 does not contribute towards the 2017/2018 £4,000 LISA allowance.
    Originally posted by playz28
    Worth double-checking this with Halifax and/or HL as it contravenes the rules laid down by HMRC, under which everything earned (or paid in as new money) in a HTB during 2017/18 counts towards the 2017/18 £4K annual LISA allowance if transferred....
    • playz28
    • By playz28 11th Jan 18, 8:01 AM
    • 2 Posts
    • 3 Thanks
    playz28
    Worth double-checking this with Halifax and/or HL as it contravenes the rules laid down by HMRC, under which everything earned (or paid in as new money) in a HTB during 2017/18 counts towards the 2017/18 £4K annual LISA allowance if transferred....
    Agreed, as I understand this was how the scheme is to be administered. However I am reporting was has been done which I have received the statements to confirm
    • TITV
    • By TITV 11th Jan 18, 8:04 AM
    • 1 Posts
    • 0 Thanks
    TITV
    I know this would have been answered a million times in this thread, but Iím hopeless with this type of stuff so would like it confirming for myself.

    I currently have 3000 in a HTB ISA. If I transfer this to Skipton before the cut off date of April, I would be entitled to the 25% additional money?

    You can only save 4000 per year, so for the next months Iíd only be able to save an extra 1000? Or would the 25% on top when switching affect this?

    Would it be worth me transferring this money over or a partial transfer?

    Iím sure Iím forgetting something aaagghh!

    Thanks for the help
    • eskbanker
    • By eskbanker 11th Jan 18, 8:56 AM
    • 6,082 Posts
    • 6,110 Thanks
    eskbanker
    I currently have 3000 in a HTB ISA. If I transfer this to Skipton before the cut off date of April, I would be entitled to the 25% additional money?
    Originally posted by TITV
    Yes, all legitimate funding of a LISA (such as this) will receive a 25% bonus. Remember that Skipton have a cutoff of 1 March for transfers to be completed this tax year.

    You can only save 4000 per year, so for the next months Iíd only be able to save an extra 1000? Or would the 25% on top when switching affect this?
    Originally posted by TITV
    It's £4K per tax year, i.e. £4K between now and 5 April 2018, then another £4K between 6 April 2018 and 5 April 2019 and so on. The bonus doesn't affect this, the limit is on contributions.

    Would it be worth me transferring this money over or a partial transfer?
    Originally posted by TITV
    Up to you after evaluating the pros and cons of one versus the other, but you can't get a bonus on a HTB and another on a LISA so it's better to choose one or the other.
    • JackStrood
    • By JackStrood 11th Jan 18, 9:49 AM
    • 1 Posts
    • 0 Thanks
    JackStrood
    Can I have a easy access rainy-day-fund ISA AND a Lifetime ISA?
    Iíve opened a ĎLifetime cash ISAí with Skipton on the 22nd Dec 2017. So max a year of £4,000. That leaves £16,000 left of the yearly personal allowance.

    But I'd also like an easy-access-rainy-day fund, an ISA makes sense due to the tax-free interest. But I can ONLY put money in the Lifetime OR another cash ISA on any given year. (That cash ISA being with the same provider?).

    So how can I have a rainy-day-fund cash ISA easily accessible anytime alongside a Skipton cash LISA? and keep benefits from both??
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