Can she save into a LISA now?

Madeinireland

My daughter has saved a sum into a LISA. She was working as a nurse in the UK and her last payment from savings into the LISA was around September 2018. She then started a working trip to Australia around November and has move there for a period of maybe upto 2 years but initially for a year.

She intends returning to the UK and buying a house - hence the saving into a LISA. Is there anything stopping her continuing to save into the LISA now she is in Australia? She will be returning in August for a two month period to attend some weddings but she will probably do a few bank shifts as a nurse so will be earning as a UK taxpayer albeit a small amount.

Would she be breaking any rules and how would anyone know anyway even if she was?

Thanks...

Paul_DNAP

No, you must be a resident in the UK to open or contribute to any sort of ISA.
https://www.gov.uk/individual-savings-accounts/if-you-move-abroad

george4064

It might be worth checking out the LISA guide located here

Madeinireland

She is a resident in the UK officially I suppose - just on a working holiday. I was advised in the past that she could her keep the LISA open (she already has opened it) so it’s really a question of whether she can contribute or not. As she is back in the UK for two months - can she contribute as she would effectively be a resident then and then would go away again for a period before returning for good.

I will check out the link given but I suspect it won’t answer this specific query and I may have to wait in the phone queue for HMRC to answer.

Thanks...

mrschaucer

Madeinireland wrote: »

She is a resident in the UK officially I suppose
As she is back in the UK for two months - can she contribute as she would effectively be a resident then and then would go away again for a period before returning for good.

There are strict rules on residency, and as far as I know you have to be UK resident for tax purposes to subscribe to an ISA of any kind. Is she still paying UK tax on her overseas earnings?

Madeinireland

She paid UK tax up until she left last year. She now pays Australian tax (I think). When she is back in the UK if she works any bank shifts she would pay UK tax. So from the point of view of HMRC I presume she would be seen as a UK taxpayer for some shifts while she is home and just appear as a low earner. If she can’t contribute she will just hold off till she is home for good but I presume there must be some breakpoint where she is able to contribute again.

Thanks...

Madeinireland

She did after all contribute last year with only part of her earnings as a UK taxpayer albeit the majority of it last year.

Paul_DNAP

If you work abroad full time and spend less than 91days in the UK in a tax year then you're not a UK resident for that year's taxation.


Last tax year she was working in the UK before she left, and if she left in November then she met the 183days living in the UK to be automatically a UK resident. (Could have been different had she left early October!)


In all though, in complex situations she may need a professional opinion.

Madeinireland

OK thanks Paul - so it sounds like she needs to be back for longer than she is planning in order to contribute - so best to wait till the following year unless her plans change.

Thanks...