HTB ISA transfer to LISA

rpoulton14

Hello,

Sorry in advance if this has been asked. If you open a help to buy ISA now and save in it until April 2017 I believe you could save £2400 in it. Once this is merged into a Lifetime ISA would you get any bonus on it or do you simple move the £2400 into the Lifetime ISA and the only 25% bonus is on the potential 4k saved after a year. Would you get a 25% bonus also on the money you moved across after a year? So an extra £600 or would you not seeing as it's not been open a year and has been merged?

thanks for the advice. Rob

bowlhead99

You get the bonus on the funds you transfer over to the L-ISA as well as on the new money you put into the L-ISA (subject to the annual limit for bonus on that new money).

You will maximise the bonus by using both products and combining them at the right time. But the bonus is only yours to keep if you actually use the money to buy a house or keep it to age 60. So if you are in any doubt about doing that, don't transfer in because you would be subject to penalties when taking it out - whereas in your current arrangement using the HTB-ISA you could withdraw (without bonus) whenever you like.

rpoulton14

many thanks for the reply, would the HTB money that has been transferred to the L-ISA get it's 25% bonus instantly, after a year, or upon purchasing a property?

thanks

Ed-1

rpoulton14 wrote: »

many thanks for the reply, would the HTB money that has been transferred to the L-ISA get it's 25% bonus instantly, after a year, or upon purchasing a property?

thanks

LISA bonuses will be paid into the account monthly but no bonuses will be paid before April 2018.

If you're interested in the details why not read the Government documentation or even the Government Bill itself that will implement it:

https://www.gov.uk/government/publications/design-of-the-lifetime-isa-technical-note

http://services.parliament.uk/bills/2016-17/savingsgovernmentcontributions.html