Lifetime ISAs guide

P1Fanatic

What are Moneybox stating as the reason it wont be paid - that you didnt deposit a minimum amount or that the account was in the wrong status? Unless they can show you a Term you have not adhered to then keep pushing them and say you will engage the Financial Ombudsman.

masonic

Sian1964 said:

The bonus wasn’t coming into the account and therefore I emailed why and they said my account wasn’t fully set up and that they required other information and then said I wouldn’t receive last years bonus money baring in mind I deposited the money before tax year. Moneybox did not notify me of this, I have email trials to state my lifetime isa was set up on the 8th September 2019.

What is the "other information" they claim to require in order to open the account? Where do they say the money you deposited has been held all this time? How did you pay the money into your LISA?

There is clear guidance in relation to the date of subscriptions to ISAs. See https://www.gov.uk/guidance/manage-isa-subscriptions-for-your-investors#cash-subscriptions and note the bolded sentences below in particular:

"Date of Subscription
Where the ISA manager has an instruction from the investor and is in control of the collection of the payment, the date of subscription is the date the manager is instructed to collect the payment provided:

•     the instruction was accepted
•     the payment is received in due course

This will cover:

•     cheques – the date of subscription is the date on which the cheque is received and accepted by the ISA manager, provided the cheque clears in due course. If the cheque does not clear, the date of subscription depends on whether the original cheque can be re-presented, or whether it must be returned to the investor
•     if the manager can re-present the original cheque without having to return it to the investor, the date of subscription is the date on which the cheque was received and accepted by the ISA manager (it has just taken longer to clear)
•     If the manager has to return the cheque to the investor, the investor has not made a subscription and the amount of the failed subscription will not count towards the ISA subscription limit. If the investor submits an amended or replacement cheque the date of subscription will be the date on which the amended (or replacement) cheque is received and accepted by the ISA manager
•     direct debit – the date on which the ISA manager is authorised to draw on the direct debit, provided that the cash transfer takes place in due course. If that date is earlier than the date on which the direct debit mandate is received and accepted by the ISA manager the date of subscription is the later date (further information is available in circumstances where the investor makes a claim under the direct debit indemnity scheme
•     debit card, charge card or credit card – the date on which authorisation is given by the investor
•     transfers from a non-ISA account held with the same manager (as the manager is in control of the payment into the ISA)

In the 4 cases above, if, due to manager error, there is a delay between accepting the instruction/authorisation and the collection of the subscription, the date of the subscription should be treated as the original date intended for the subscription (even if this was in an earlier tax year) provided the manager had accepted the instruction by that date. Where the subscription is backdated to an earlier year and the annual information return for that year has been submitted, there is no need to make an additional report.

Where the collection of the payment depends upon another body so that the ISA manager is not in control (and may be unaware that a payment will be made), the date of subscription is the date the ISA manager receives the payment. This will cover standing orders and telegraphic transfers where the instruction to pay sits with someone other than the ISA manager.
If the payment instruction has been received and accepted by the ISA manager but due to manager error there is a delay before the sum is applied to the ISA, any compensation paid to cover lost growth and/or income, can be added to the ISA without counting as a fresh subscription. This differs from the situation described in Delay in opening an ISA, or in accepting a subscription as in that case the instruction has not been accepted."

masonic

bogleboogle said:

Hi all,
I opened a Cash LISA with Newcastle BS in December 2019. Interest at the time of opening was 1.1%, calculated daily but paid every November I believe. The interest rate has recently fallen to 0.45%. 
I see that Nottingham BS have a Cash LISA which offers 1.25% interest - if I were to switch my LISA over to Nottingham BS what would happen to the interest I have accrued (but not yet been paid) with Newcastle BS up to the date of switching?
Thanks

Accrued interest will be added to the closing balance of the Newcastle LISA.

bogleboogle

masonic said:

bogleboogle said:

Hi all,
I opened a Cash LISA with Newcastle BS in December 2019. Interest at the time of opening was 1.1%, calculated daily but paid every November I believe. The interest rate has recently fallen to 0.45%. 
I see that Nottingham BS have a Cash LISA which offers 1.25% interest - if I were to switch my LISA over to Nottingham BS what would happen to the interest I have accrued (but not yet been paid) with Newcastle BS up to the date of switching?
Thanks

Accrued interest will be added to the closing balance of the Newcastle LISA.

Thank you. 
As a follow-up question: if I were to switch the LISA across, would I still be able to pay into it this tax year? I read that you can only pay into one LISA per year, so I'm confused how that would work for a switch in LISA provider within a tax year. (I have already paid in some of my £4000 allowance for this tax year.)

masonic

bogleboogle said:

masonic said:

bogleboogle said:

Hi all,
I opened a Cash LISA with Newcastle BS in December 2019. Interest at the time of opening was 1.1%, calculated daily but paid every November I believe. The interest rate has recently fallen to 0.45%. 
I see that Nottingham BS have a Cash LISA which offers 1.25% interest - if I were to switch my LISA over to Nottingham BS what would happen to the interest I have accrued (but not yet been paid) with Newcastle BS up to the date of switching?
Thanks

Accrued interest will be added to the closing balance of the Newcastle LISA.

Thank you. 
As a follow-up question: if I were to switch the LISA across, would I still be able to pay into it this tax year? I read that you can only pay into one LISA per year, so I'm confused how that would work for a switch in LISA provider within a tax year. (I have already paid in some of my £4000 allowance for this tax year.)

Yes, as far as HMRC is concerned a transferred LISA is the same LISA.

bogleboogle

masonic said:

bogleboogle said:

masonic said:

bogleboogle said:

Hi all,
I opened a Cash LISA with Newcastle BS in December 2019. Interest at the time of opening was 1.1%, calculated daily but paid every November I believe. The interest rate has recently fallen to 0.45%. 
I see that Nottingham BS have a Cash LISA which offers 1.25% interest - if I were to switch my LISA over to Nottingham BS what would happen to the interest I have accrued (but not yet been paid) with Newcastle BS up to the date of switching?
Thanks

Accrued interest will be added to the closing balance of the Newcastle LISA.

Thank you. 
As a follow-up question: if I were to switch the LISA across, would I still be able to pay into it this tax year? I read that you can only pay into one LISA per year, so I'm confused how that would work for a switch in LISA provider within a tax year. (I have already paid in some of my £4000 allowance for this tax year.)

Yes, as far as HMRC is concerned a transferred LISA is the same LISA.

Great, thanks!
Last issue: I won't receive the government bonus for my latest payment until later this month, should I wait to transfer the LISA until then or will that also transfer across somehow? (Newcastle BS say they themselves claim the bonus from HMRC, which I assume is standard practice.)

masonic

bogleboogle said:

masonic said:

bogleboogle said:

masonic said:

bogleboogle said:

Hi all,
I opened a Cash LISA with Newcastle BS in December 2019. Interest at the time of opening was 1.1%, calculated daily but paid every November I believe. The interest rate has recently fallen to 0.45%. 
I see that Nottingham BS have a Cash LISA which offers 1.25% interest - if I were to switch my LISA over to Nottingham BS what would happen to the interest I have accrued (but not yet been paid) with Newcastle BS up to the date of switching?
Thanks

Accrued interest will be added to the closing balance of the Newcastle LISA.

Thank you. 
As a follow-up question: if I were to switch the LISA across, would I still be able to pay into it this tax year? I read that you can only pay into one LISA per year, so I'm confused how that would work for a switch in LISA provider within a tax year. (I have already paid in some of my £4000 allowance for this tax year.)

Yes, as far as HMRC is concerned a transferred LISA is the same LISA.

Great, thanks!
Last issue: I won't receive the government bonus for my latest payment until later this month, should I wait to transfer the LISA until then or will that also transfer across somehow? (Newcastle BS say they themselves claim the bonus from HMRC, which I assume is standard practice.)

Yes this is standard practice, see https://www.gov.uk/guidance/transfer-lifetime-isas-between-managers

bogleboogle

masonic said:

bogleboogle said:

masonic said:

bogleboogle said:

masonic said:

bogleboogle said:

Hi all,
I opened a Cash LISA with Newcastle BS in December 2019. Interest at the time of opening was 1.1%, calculated daily but paid every November I believe. The interest rate has recently fallen to 0.45%. 
I see that Nottingham BS have a Cash LISA which offers 1.25% interest - if I were to switch my LISA over to Nottingham BS what would happen to the interest I have accrued (but not yet been paid) with Newcastle BS up to the date of switching?
Thanks

Accrued interest will be added to the closing balance of the Newcastle LISA.

Thank you. 
As a follow-up question: if I were to switch the LISA across, would I still be able to pay into it this tax year? I read that you can only pay into one LISA per year, so I'm confused how that would work for a switch in LISA provider within a tax year. (I have already paid in some of my £4000 allowance for this tax year.)

Yes, as far as HMRC is concerned a transferred LISA is the same LISA.

Great, thanks!
Last issue: I won't receive the government bonus for my latest payment until later this month, should I wait to transfer the LISA until then or will that also transfer across somehow? (Newcastle BS say they themselves claim the bonus from HMRC, which I assume is standard practice.)

Yes this is standard practice, see https://www.gov.uk/guidance/transfer-lifetime-isas-between-managers

I shall begin the transfer process ASAP then, thank you. 

Is there a limit to the number of times I can transfer LISA providers (or any other potential downside to this)? I'm asking in case of future interest rate decreases (which seems likely). 

masonic

bogleboogle said:

masonic said:

bogleboogle said:

masonic said:

bogleboogle said:

masonic said:

bogleboogle said:

Hi all,
I opened a Cash LISA with Newcastle BS in December 2019. Interest at the time of opening was 1.1%, calculated daily but paid every November I believe. The interest rate has recently fallen to 0.45%. 
I see that Nottingham BS have a Cash LISA which offers 1.25% interest - if I were to switch my LISA over to Nottingham BS what would happen to the interest I have accrued (but not yet been paid) with Newcastle BS up to the date of switching?
Thanks

Accrued interest will be added to the closing balance of the Newcastle LISA.

Thank you. 
As a follow-up question: if I were to switch the LISA across, would I still be able to pay into it this tax year? I read that you can only pay into one LISA per year, so I'm confused how that would work for a switch in LISA provider within a tax year. (I have already paid in some of my £4000 allowance for this tax year.)

Yes, as far as HMRC is concerned a transferred LISA is the same LISA.

Great, thanks!
Last issue: I won't receive the government bonus for my latest payment until later this month, should I wait to transfer the LISA until then or will that also transfer across somehow? (Newcastle BS say they themselves claim the bonus from HMRC, which I assume is standard practice.)

Yes this is standard practice, see https://www.gov.uk/guidance/transfer-lifetime-isas-between-managers

I shall begin the transfer process ASAP then, thank you. 

Is there a limit to the number of times I can transfer LISA providers (or any other potential downside to this)? I'm asking in case of future interest rate decreases (which seems likely). 

There is no limit to the number of times you can transfer. You may find there are a few days during the transfer where your money isn't earning interest, but some providers backdate interest to prevent this happening.

bogleboogle

masonic said:

bogleboogle said:

masonic said:

bogleboogle said:

masonic said:

bogleboogle said:

masonic said:

bogleboogle said:

Hi all,
I opened a Cash LISA with Newcastle BS in December 2019. Interest at the time of opening was 1.1%, calculated daily but paid every November I believe. The interest rate has recently fallen to 0.45%. 
I see that Nottingham BS have a Cash LISA which offers 1.25% interest - if I were to switch my LISA over to Nottingham BS what would happen to the interest I have accrued (but not yet been paid) with Newcastle BS up to the date of switching?
Thanks

Accrued interest will be added to the closing balance of the Newcastle LISA.

Thank you. 
As a follow-up question: if I were to switch the LISA across, would I still be able to pay into it this tax year? I read that you can only pay into one LISA per year, so I'm confused how that would work for a switch in LISA provider within a tax year. (I have already paid in some of my £4000 allowance for this tax year.)

Yes, as far as HMRC is concerned a transferred LISA is the same LISA.

Great, thanks!
Last issue: I won't receive the government bonus for my latest payment until later this month, should I wait to transfer the LISA until then or will that also transfer across somehow? (Newcastle BS say they themselves claim the bonus from HMRC, which I assume is standard practice.)

Yes this is standard practice, see https://www.gov.uk/guidance/transfer-lifetime-isas-between-managers

I shall begin the transfer process ASAP then, thank you. 

Is there a limit to the number of times I can transfer LISA providers (or any other potential downside to this)? I'm asking in case of future interest rate decreases (which seems likely). 

There is no limit to the number of times you can transfer. You may find there are a few days during the transfer where your money isn't earning interest, but some providers backdate interest to prevent this happening.

Thank you for your help!