Lifetime ISAs guide

Tom_Hendo

eskbanker wrote: »

Having answered you when you've asked this before in march and april there's unfortunately no change in the reply, in that the MSE article I've pointed you to previously still doesn't show any further entrants (when they've committed to update it when there's news) and to the best of my knowledge there haven't been any reported on the forum either....

Thanks for the update. Yeah I ask each month so I get the most up to date info, dont think thats too much to ask is it? :j

djb87

I have a query regarding funding both a Help to Buy ISA and a LISA in the same tax year.

Before this current tax year (17/18) started, I had a Help to Buy ISA (with Lloyds) which I was funding on a direct debit basis, £200 per month. At the beginning of this new tax year, I set up and fully funded a Lifetime ISA with Nutmeg with £4000 (the maximum you can put in a LISA in a given tax year).

Unfortunately, I forgot to switch off my direct debits, meaning that I have inadvertently paid an extra £200 this side of the tax year - in May - into my Help to Buy ISA.

Please advise on how I can rectify this. I am concerned that I will not be able to use my HTB ISA to buy a house this tax year if I don't do the right thing. It seems logical that I should take £200 out of my HTB ISA so everything squares off.

I have phone HMRC who have been no help whatsoever!

isasmurf

You have done nothing wrong. You are allowed to contribute to both a HTB and LISA in the same tax year. You will only be able to use the bonus from one of them for a house purchase, however.

If your intention is to use the HTB ISA bonus for the house purchase, you should continue to save in this.

Ed-1

djb87 wrote: »

I have a query regarding funding both a Help to Buy ISA and a LISA in the same tax year.

Before this current tax year (17/18) started, I had a Help to Buy ISA (with Lloyds) which I was funding on a direct debit basis, £200 per month. At the beginning of this new tax year, I set up and fully funded a Lifetime ISA with Nutmeg with £4000 (the maximum you can put in a LISA in a given tax year).

Unfortunately, I forgot to switch off my direct debits, meaning that I have inadvertently paid an extra £200 this side of the tax year - in May - into my Help to Buy ISA.

Please advise on how I can rectify this. I am concerned that I will not be able to use my HTB ISA to buy a house this tax year if I don't do the right thing. It seems logical that I should take £200 out of my HTB ISA so everything squares off.

I have phone HMRC who have been no help whatsoever!

A Help to Buy ISA is a cash ISA. You can pay into a cash ISA as well as pay into a Lifetime ISA.

eskbanker

djb87 wrote: »

I am concerned that I will not be able to use my HTB ISA to buy a house this tax year if I don't do the right thing.

If you're wanting to buy a house this tax year then you won't be able to get the 25% bonus on the £4K in your LISA, as penalty-free LISA withdrawals are only possible a full 12 months after opening and the first LISA bonuses won't be paid until early in the next tax year.

MTG84

Hi all,

Sorry if this has already posted, but i still am a little confused with the bonus payments between the transfer from the Help to buy to a LISA.

I have had a Help to Buy ISA since April 2016 and have built it up £4,000 (with a £1,000 bonus currently).

If i were to transfer this to a LISA account and have the open for 12 months, at the end of the 12 month period, would i receive both the £1,000 bonus built up from the help to buy isa PLUS a £1,000 bonus from the LISA account to have £2,000 bonus by the end of June 2018?

E.g at the end of June 2018:

• Help to buy isa transfer during 2017/2018 to tax year to an isa - £4,000 (£1,000 bonus)
• Lisa contribution - £4,000 (£1,000 bonus)
• = £2,000 bonus by June 2018?

Thanks for any help on this!

Ed-1

MTG84 wrote: »

Hi all,

Sorry if this has already posted, but i still am a little confused with the bonus payments between the transfer from the Help to buy to a LISA.

I have had a Help to Buy ISA since April 2016 and have built it up £4,000 (with a £1,000 bonus currently).

If i were to transfer this to a LISA account and have the open for 12 months, at the end of the 12 month period, would i receive both the £1,000 bonus built up from the help to buy isa PLUS a £1,000 bonus from the LISA account to have £2,000 bonus by the end of June 2018?

E.g at the end of June 2018:

• Help to buy isa transfer during 2017/2018 to tax year to an isa - £4,000 (£1,000 bonus)
• Lisa contribution - £4,000 (£1,000 bonus)
• = £2,000 bonus by June 2018?

Thanks for any help on this!

Anything paid into the LISA in 2017/18 (and that includes anything transferred from a H2B ISA) receives a 25% bonus at the start of May 2018.

Anything paid in to the LISA in 2018/19 onwards gets a bonus at the start of the month after it was paid in.

MTG84

Ed-1 wrote: »

Anything paid into the LISA in 2017/18 (and that includes anything transferred from a H2B ISA) receives a 25% bonus at the start of May 2018.

Anything paid in to the LISA in 2018/19 onwards gets a bonus at the start of the month after it was paid in.

Thanks, does this mean i would receive the bonus already built up from the help to buy isa in addition to the lisa bonus?

Ed-1

MTG84 wrote: »

Thanks, does this mean i would receive the bonus already built up from the help to buy isa in addition to the lisa bonus?

Yes as it was paid into the LISA. Anything paid into the LISA gets a LISA bonus of 25% at the start of May 2018:

Anything paid into the LISA in 2017/18 (and that includes anything transferred from a H2B ISA) receives a 25% bonus at the start of May 2018.

greenglide

Yes.

You get the HTB bonus only when you buy a house. You haven't done that so you haven't got the bonus.

When you transfer to LISA in 2017/2018 you haven't got the bonus from the HTB or the LISA but you get the bonus for both at the start of 2018/2019.