LISA - UK house purchase only?

aroominyork

My son has a LISA but is living abroad and might end up buying his first home abroad. Would the LISA qualify for this purchase? If not, could he later use it for his first UK (second overall) purchase?

eskbanker

aroominyork said:

My son has a LISA but is living abroad and might end up buying his first home abroad. Would the LISA qualify for this purchase?

https://www.gov.uk/guidance/lifetime-isa-withdrawals-for-a-first-time-residential-purchase#withdrawals-for-a-first-time-residential-purchase

Investors can make charge-free withdrawals from a Lifetime ISA if the funds are going towards the purchase price of their first residential property in the UK.

aroominyork said:

If not, could he later use it for his first UK (second overall) purchase?

No, once he's owned a property anywhere he's no longer a first-time buyer for the purposes of the scheme.

aroominyork

eskbanker said:

aroominyork said:

If not, could he later use it for his first UK (second overall) purchase?

No, once he's owned a property anywhere he's no longer a first-time buyer for the purposes of the scheme.

Do you have a source for that, please? The wording on the link you gave is open to interpretation: "...the funds are going towards the purchase price of their first residential property in the UK".

Alexland

aroominyork said:

Do you have a source for that, please? The wording on the link you gave is open to interpretation: "...the funds are going towards the purchase price of their first residential property in the UK".

If you look at the model declaration that the LISA investor is required to sign it is clearer "I will only use the funds I have withdrawn from my Lifetime ISA towards buying my first residential property"

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/695292/example_of_Investor_model_dec.pdf

eskbanker

aroominyork said:

eskbanker said:

aroominyork said:

If not, could he later use it for his first UK (second overall) purchase?

No, once he's owned a property anywhere he's no longer a first-time buyer for the purposes of the scheme.

Do you have a source for that, please? The wording on the link you gave is open to interpretation: "...the funds are going towards the purchase price of their first residential property in the UK".

Not sure if it's conveyed in any of the guidance notes but the authoritative definition is in the LISA schedule to the main ISA legislation, at https://www.legislation.gov.uk/uksi/1998/1870/schedule, where it's clearer:

“first-time buyer” means an account investor who is not, and never has been, a residential property owner;

[...]

“residential property owner” means an individual who owns as sole or joint owner an interest in residential property (including a legal interest in land acquired under the terms of a regulated home purchase plan or a shared ownership arrangement) which is—

(a) in England or Wales—

(i) freehold;

(ii) leasehold, where the lease was originally granted for a term certain exceeding 21 years; or

(iii) commonhold;

(b) in Scotland, registered or recorded, or would be capable of being registered or recorded, as a right of absolute ownership in the Land Register of Scotland or General Register of Sasines in Scotland, as applicable;

(c) in Northern Ireland—

(i) freehold; or

(ii) leasehold, where the lease was originally granted for a term certain exceeding 21 years; or

(d) an equivalent interest in land to the legal interests in land listed in paragraphs (a) to (c) under the laws of any jurisdiction outside the United Kingdom;