We're aware that some users are experiencing technical issues which the team are working to resolve. See the Community Noticeboard for more info. Thank you for your patience.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!

Lifetime ISA and moving abroad

Options
Hi all.

Ive been reading about the lifetime ISA being introduced soon and I have a query about it. As a young adult (who hopes to move abroad in the future) I am wondering:
1. Since this is a long-term saving, would I be able to withdraw before I leave; a. Without being charged and b. With the government bonus
2. Would saving into this be worth it as opposed to something else

I am aware that you cant contribute to an ISA if you are not a UK resident and I have checked the government document (Cant link as a new user) for LISA but it mentions nothing about leaving to live in a different country.

Thank you in advance.

Comments

  • masonic
    masonic Posts: 27,058 Forumite
    Part of the Furniture 10,000 Posts Photogenic Name Dropper
    You should be able to keep the LISA if you move abroad, but you wouldn't be able to continue contributing to it if you cease to be UK resident.

    It is a long term savings/investment product, so you won't be able to withdraw the money penalty free before the age of 60, with the exception of if you use the money to purchase a UK property as a first time buyer.
  • AnotherJoe
    AnotherJoe Posts: 19,622 Forumite
    10,000 Posts Fifth Anniversary Name Dropper Photogenic
    Given what you've said about emigrating, this would be an unsuitable product for you.

    Unless by "going abroad" you just meant for a few years and then you'd come back to buy a house.
  • GMNN
    GMNN Posts: 54 Forumite
    Eighth Anniversary 10 Posts Combo Breaker
    Hello - related but slightly different question:

    Will I be able to withdraw the LISA money penalty-free if living abroad?

    I understand I cannot contribute while living abroad, but let's say I contribute for 10-15 years and then move abroad in my 50's and never come back to the UK - I'll keep my LISA open during that time and let the money accrue, without making any additional contributions. Would there then be a requirement to be a UK resident to withdraw the money once I turn 60? Have looked at many articles and none of them address this issue...
  • masonic
    masonic Posts: 27,058 Forumite
    Part of the Furniture 10,000 Posts Photogenic Name Dropper
    GMNN wrote: »
    Will I be able to withdraw the LISA money penalty-free if living abroad?
    It will be subject to the T&Cs of the LISA provider. I don't believe there is a specific ISA rule that prohibits it.
  • colsten
    colsten Posts: 17,597 Forumite
    10,000 Posts Seventh Anniversary Photogenic Name Dropper
    masonic wrote: »
    It will be subject to the T&Cs of the LISA provider. I don't believe there is a specific ISA rule that prohibits it.
    I agree, there is currently nothing that suggests there would be a non-resident withdrawal fee. I wouldn't rely on that remaining the case though. There is nothing that prevents a Chancellor from introducing such a fee in future. There are all sorts of things in the pipeline that might be taken off people who decide to leave the UK, and there are growing demands that people who do not pay tax in the UK should not be able to benefit from taxpayer-funded perks.

    I certainly wouldn't rely on the opinions of some strangers on an internet forum - instead, I would ask the HMRC for a position in writing. My guess is they'd just give a woolly response along the above lines.
  • mlb1984
    mlb1984 Posts: 8 Forumite
    One thing to consider is whether the interest, government bonus, or capital gains on the ISA would be considered taxable in your country of residence. The tax-free status of ISAs is a UK thing only, and not recognised by foreign tax systems.
This discussion has been closed.
Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 350.7K Banking & Borrowing
  • 253K Reduce Debt & Boost Income
  • 453.4K Spending & Discounts
  • 243.7K Work, Benefits & Business
  • 598.5K Mortgages, Homes & Bills
  • 176.8K Life & Family
  • 256.9K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16.1K Discuss & Feedback
  • 37.6K Read-Only Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.