HTB and lifetime ISA during 2017/18

Mike_320

From my understanding you can contribute to both HTB (£200pm) and Lifetime ISA (£4000 at any point during the year) from April 2017 and at any point during 2017/18 financial year you can transfer from HTB to a Lifetime ISA.

I was wondering by transferring the HTB ISA at the end of the year you could in theory get 25% bonus on £6400 during 2017/18 and put it all towards the deposit on a house.

I know there is not much small print yet about the Lifetime ISA yet but has anybody read anything which would exclude this possibility.

Cheers,

Flobberchops

I assumed that HTB and LISA were both cash ISAs and therefore you could only subscribe to one or the other?

[edit] OK, scratch that - just read the MSE Lifetime ISA article which seems to suggest you can pay into multiple ISAs up to the (then) £20k limit. HTB ISAs are notably absent from the list. Can anyone clarify?

Mike_320

From what i have read LISA will be a separate entity whereas HTB ISA is classed as a cash ISA.

To answer my original question after re-reading the article I missed:
"Anything saved in the Help to Buy ISA after this time (April 2017) and then transferred will eat in to the Lifetime ISA limit for that tax year"

PeacefulWaters

This government document gives you more information around the interaction between HTB ISA and Lifetime ISA.

I like the concept of lifetime.ISA. But alongside HTB and various other changes to ISAs and pensions the poor consumer can only end up confused!

kidmugsy

Could it be worth someone's while to open an HTB iSA with a view to later transferring it into a LISA, and keeping the combination as a pension-substitute? (They might, for instance, buy a house using the Bank of Mum and Dad and leave the LISA untouched.)

I'm assuming that they pay 20% income tax, don't have salary sacrifice available, and have already maximised the employer's pension contribution.