Lifetime ISAs guide

Alexland

snowqueen555 wrote: »

It annoys me there s not more competition in this category, if instant access can offer 1.5% I would've thought a Lisa would at least offer that.

There is some competition however it is a complicated product to administer (claiming bonuses from HMRC, applying penalties, checking buyer declarations, working with solicitors, etc) so the lower rate reflects the increased cost to operate the account.

Alexland

2BobB wrote: »

I opened it on the 22nd of May last year and after reading (what I considered to be) carefully all instructions and information I could glean I simply thought that as long as I deposited a grand total of £4,000 by the 22nd of this month I would qualify for the £1,000 bonus a year later.

ISA contribution limits run on tax years which start on the 6th April each year. As such if you did not contribute £4k into the LISA by the 5th April then you did not make the most of the 25% bonus opportunity last tax year.

After every tax year month (starting on the 6th) the LISA providers adds up how much was contributed and raises a claim for 25% which is added to your account a few weeks later.

The '12 month rule' was just the minimum period of time since the account was opened with an initial contribution before it could be used for a penalty free qualifying property purchase. This may also align to the annual interest payment. It is completely unrelated to the contribution limits and bonus payment schedules.

Alex

cjd08

My wife and I would like to open a Lifetime ISA each so that we can start saving for a house. We have contacted three building societies who offer Cash Lifetime ISAs, and are receiving conflicting information as to whether or not my wife is eligible to open one. She is from Colombia, and currently has Leave to Remain (not yet Indefinite Leave to Remain). We got married last year, and she now has a Spouse Visa, which she needs to renew for another 2.5 years next year. She won't be able to apply for Indefinite Leave to Remain until she has been in the UK for 5 years. The criteria on gov.uk only states that you must be a UK Resident to open a Lifetime ISA, it does not say anything (as far as I can see) about Indefinite Leave to Remain. Newcastle Building Society say that she needs ILR and therefore is not eligible. Nottingham also say that she needs ILR but she could still apply anyway (???). Skipton Building Society say that she is eligible. So now we are totally confused, and trying to get a definitive answer from someone has been a nightmare. HMRC said I need to contact the Money Advice Service, the Money Advice Service told me I need to speak to HMRC. I told them HMRC couldn't help me so now I've been given the number for Nottingham Law Centre, but before I call them I thought I'd see if anyone here can please help or offer any advice?

badger09

cjd08 wrote: »

My wife and I would like to open a Lifetime ISA each so that we can start saving for a house. We have contacted three building societies who offer Cash Lifetime ISAs, and are receiving conflicting information as to whether or not my wife is eligible to open one. She is from Colombia, and currently has Leave to Remain (not yet Indefinite Leave to Remain). We got married last year, and she now has a Spouse Visa, which she needs to renew for another 2.5 years next year. She won't be able to apply for Indefinite Leave to Remain until she has been in the UK for 5 years. The criteria on gov.uk only states that you must be a UK Resident to open a Lifetime ISA, it does not say anything (as far as I can see) about Indefinite Leave to Remain. Newcastle Building Society say that she needs ILR and therefore is not eligible. Nottingham also say that she needs ILR but she could still apply anyway (???). Skipton Building Society say that she is eligible. So now we are totally confused, and trying to get a definitive answer from someone has been a nightmare. HMRC said I need to contact the Money Advice Service, the Money Advice Service told me I need to speak to HMRC. I told them HMRC couldn't help me so now I've been given the number for Nottingham Law Centre, but before I call them I thought I'd see if anyone here can please help or offer any advice?

Apologies, I've only skim read the official instructions as I don't have time right now, but I can't see any reference to Indefinite Leave to Remain mentioned anywhere. The normal residence rules seem to apply to LISA in the same way as to other types of ISA

https://www.gov.uk/guidance/who-can-invest-in-an-isa-if-youre-an-isa-manager#res-qual

deutsch

Anyone have a LISA with AJ Bell? Last year the £1000 bonus went in by 2nd May. Still waiting on this year's. Anyone else?

Alexland

deutsch wrote: »

Anyone have a LISA with AJ Bell? Last year the £1000 bonus went in by 2nd May. Still waiting on this year's. Anyone else?

I am not with AJ Bell but on what date did you make the contribution to expect a £1k bonus now? If it was upto and including the 5th April (ie you are waiting on a bonus from a contribution last tax year) then yes it would be expected by now so suggest you raise a ticket to ask them?

Alex

dqnet

deutsch wrote: »

Anyone have a LISA with AJ Bell? Last year the £1000 bonus went in by 2nd May. Still waiting on this year's. Anyone else?

In general the cut off period for AJ Bell to credit your account with the bonus in the same month is around the 7th of the month (not taking bank holidays and weekends into consideration). So providing you deposit your desired amount before the 7th of the month, you should get your bonus by the end of the same month. Sometimes this can drag into the first few days of the following month. Any money deposited after the 7th of the month will be treated as if the money was deposited the following month and you will have to wait until the end of that month to get the bonus.

Alexland

dqnet wrote: »

In general the cut off period for AJ Bell to credit your account with the bonus in the same month is around the 7th of the month (not taking bank holidays and weekends into consideration). So providing you deposit your desired amount before the 7th of the month, you should get your bonus by the end of the same month. Sometimes this can drag into the first few days of the following month. Any money deposited after the 7th of the month will be treated as if the money was deposited the following month and you will have to wait until the end of that month to get the bonus.

Surely it's at the end of the 5th of the month to align with the tax year? Anything deposited to the LISA from the 6th of the month would be in the next claim period.

Alex

masonic

I've deposited on 6th April at AJ Bell a couple of years running. I received my bonus in late May last year, and have yet to receive it this year, so as Alex says, the claim period is aligned with the tax year.

cjd08

badger09 wrote: »

Apologies, I've only skim read the official instructions as I don't have time right now, but I can't see any reference to Indefinite Leave to Remain mentioned anywhere. The normal residence rules seem to apply to LISA in the same way as to other types of ISA

Many thanks for this, much appreciated indeed. I'll have a look at the rules you have linked to, I don't see there being any issues - she is resident in the UK and has been living here since February 2018.


I called HMRC again and they could not find anything in their own guidance that said that you need Indefinite Leave to Remain to apply for a Lifetime ISA, only that you have to be a UK resident. I spoke to Skipton Building Society twice, and both times they confirmed that as long as she has been in the UK for a minimum of 6 months in the year then she would be eligible. Newcastle said that the requirement to have ILR is their own requirement.


I just have one more question. Is there any problem if I open the ISA with Newcastle (the interest rate is slightly better), and my wife goes with Skipton? Or do we both have to open the ISA with the same bank or building society in order to both receive the government bonus?