Lifetime ISAs guide

Alexland

1muffin wrote: »

This year I've recently transferred in the full £4k allowance - when can I expect the bonus? I opened the account in June 2017 (with £1 minimum opening amount).

The bonus relating to this tax year contributions is due in April/May.

1muffin wrote: »

2018-2019:
I have other savings, and would like to keep them elsewhere to maximise interest. For the year 2018-2019, if I transfer in the full £4k allowance in March 2019 (or late as possible), can I expect the full £1k bonus, or would I need to transfer that earlier in the tax year? When will that be paid?

You might as well keep it elsewhere for most of the tax year as the better return will still probably beat the interest on an earlier bonus. If you make the contribution towards the end of the tax year you can expect the full bonus a month of two after.

1muffin

Thanks - just to be 100% sure, for next year, I may as well keep it in until end of March and then transfer to the LISA? What if I was to buy a house in say February - should I transfer over a couple of months before that?

Lucyf214

Hi can I confirm if I open a LISA today and deposit 4k do I get this years 1k bonus?

Alexland

1muffin wrote: »

Thanks - just to be 100% sure, for next year, I may as well keep it in until end of March and then transfer to the LISA? What if I was to buy a house in say February - should I transfer over a couple of months before that?

Yes just deposit the money before the tax year ends on 5th April leaving a few weeks incase there are and unexpected issues.

As you get closer to buying a property you would want to bring forward the contribution for that tax year to ensure the bonus is added to the account in time for the solicitor to draw the money to support the qualifying purchase.

NickG85

Hi all.

I am looking to reserve a plot at the new Graven Hill development in Bicester, I have a Help to buy ISA account and I was wondering if anyone knows if you can use the Help to buy ISA and bonus for self-builds instead of just buying a completed home?

Any thoughts would be much appreciated.

Thanks,
Nick.

Alexland

Lucyf214 wrote: »

Hi can I confirm if I open a LISA today and deposit 4k do I get this years 1k bonus?

Yes it should be added to the account in April/May. Make sure you fully understand the T&C's before you do this as it's a complicated product.

Ninetails

Hi everyone

I understand the limitations of both HTB and LISAs, but am unsure what advice to give to our children. They are some years off buying - and the ceiling of £450K barely covers London now let alone in years to come.

If housing is more than the £450K when they buy (which will most certainly will be), the LISA will turn into their retirement savings unless they are willing to forego the 25% penalty - which is money that they could have used for their deposit.

Maybe Londoners should stick with HTB and other savings?

bowlhead99

1muffin wrote: »

Thanks - just to be 100% sure, for next year, I may as well keep it in until end of March and then transfer to the LISA?

Yes, you could put the money in an account paying a higher rate of interest until whenever you would like to move it into the LISA.

What if I was to buy a house in say February - should I transfer over a couple of months before that?

If you want there to be some bonus funds in the account for your £4k, which of course you do, then yes, put it in with enough time for them to collect the bonus. You don't want to put it in late and get the bonus late and then be scrabbling around trying to get the bonus applied and withdrawing all/most of the funds before you complete on the property. Buying a property is stressful enough.

Lucyf214 wrote: »

Hi can I confirm if I open a LISA today and deposit 4k do I get this years 1k bonus?

Yes, assuming you don't take the money out again before getting to the end of the tax year when they will look to see what contributions you made this tax year that they need to pay bonus on.

Alexland

NickG85 wrote: »

I am looking to reserve a plot at the new Graven Hill development in Bicester, I have a Help to buy ISA account and I was wondering if anyone knows if you can use the Help to buy ISA and bonus for self-builds instead of just buying a completed home?

Not sure why you posted this in the LISA thread but yes

https://www.helptobuy.gov.uk/help-to-buy-isa/faq/#buying-land

"Can I use a Help to Buy: ISA bonus to buy land to build my first property on?
Assuming that you meet all the other eligibility criteria, you will be able to use the government bonus towards the purchase of the land for a self-build property which is the only home you will own, be where you intend to live and be purchased with a mortgage. The land must be in the UK, have a price of £250,000 or less (with a higher price limit of £450,000 in London)."

Alex

Alexland

Ninetails wrote: »

Hi everyone

I understand the limitations of both HTB and LISAs, but am unsure what advice to give to our children. They are some years off buying - and the ceiling of £450K barely covers London now let alone in years to come.

If housing is more than the £450K when they buy (which will most certainly will be), the LISA will turn into their retirement savings unless they are willing to forego the 25% penalty - which is money that they could have used for their deposit.

Maybe Londoners should stick with HTB and other savings?

Epm-84 had an interesting idea of what to do in the event the LISA cannot be used for a property purchase - withdraw most if it and pay the penalty (so loss of bonus and a bit more) but keep enough in the LISA for retirement that the bonus on the amount left is equal to the bit more penalty paid on the amount withdrawn.

That way you would have freed up cash for the deposit for a property over £450k and with the remainder in the LISA (which would need to be kept until 60) you still have the amount you started with.

Alex