Multiple LISAs to purchase one property - misleading information (lifetime isa)

thomas01155

There is currently numerous incorrect information around LISAs online, even on MSE some of the information is a bit off. Presumably as it's a fairly recent offering.

Wrong / confusing information:

"If you've multiple LISAs, you can transfer them all into one LISA before you buy – you can then use the entire amount without penalty, so long as that LISA has been open for at least a year."

You do not need to move all your LISAs into one account before purchasing as stated here, it's fine to leave them with different providers and complete multiple charge free withdrawal forms: https://www.moneysavingexpert.com/savings/lifetime-isas/


Be clever with your cash makes it sound like you can only use more than one if you are buying with someone else, this is also wrong. You can use multiple LISA's yourself.

You can use more than one LISA for a property if you’re buying with someone else and they’re also a first-time buyer. And you can still use your LISA if the other person has previously had a property.

https://becleverwithyourcash.com/lifetime-isas-explained-get-a-25-bonus/#:~:text=A Lifetime ISA is form,£1,000 each financial year.


Wrong info from Barclays:

Accounts are limited to one per person rather than one per home

Barclays: https://www.barclays.co.uk/savings/isas/guide-to-lifetime-isas/ 


Wrong info on Beehive:

Can I have multiple Lifetime ISAs?
No, unlike other types of ISA, you can’t have more than one Lifetime ISA at any time. If you want to change to a LISA with a different provider you’ll need to transfer your balance over. Once complete, your old provider will close your LISA with them

https://beehive.my.site.com/s/article/Beehive-Lifetime-ISA-Everything-you-need-to-know-including-bonus-payments-and-how-to-withdraw

Correct information from HRMC / Gov:

Withdrawal amount for house purchase
There’s no minimum amount which must be withdrawn from a Lifetime ISA for a house purchase and, providing the relevant conditions are met for each withdrawal, there’s no limit to the number of charge-free withdrawals an investor can make for a first time residential purchase. The individual may:

• have more than one Lifetime ISA (either with the same or a different provider)

• need to make several withdrawals between initial deposit and completion of the purchase but all withdrawals must be used to cover the purchase price

If more than one withdrawal is made, the withdrawal process must be followed for each one.

https://www.gov.uk/government/publications/conveyancers-lifetime-isa-technical-guidance/conveyancers-lifetime-isa-technical-guidance

You can open more than one Lifetime ISA during your life, but you can only open one per tax year and put money into one per tax year. Each time you apply for a new Lifetime ISA you will still need to meet the eligibility criteria (above) for opening an account.

https://lifetimeisa.campaign.gov.uk/

https://www.gov.uk/lifetime-isa

eskbanker

thomas01155 said:

There is currently numerous incorrect information around LISA's online, even on MSE some of the information is a bit off. Presumably as it's a fairly recent offering.

Not really recent anymore, now over six years old!

thomas01155 said:

Wrong / confusing information:

"If you've multiple LISAs, you can transfer them all into one LISA before you buy – you can then use the entire amount without penalty, so long as that LISA has been open for at least a year."

You do not need to move all your LISA's into one account before purchasing as stated here, it's fine to leave them with different providers and complete multiple charge free withdrawal forms: https://www.moneysavingexpert.com/savings/lifetime-isas/

Doesn't seem wrong to me, it says you can transfer them, it's not saying that you need to, other than perhaps by the unnecessary inclusion of 'then'.

thomas01155 said:

Be clever with your cash makes it sound like you can only use more than one if you are buying with someone else, this is also wrong. You can use multiple LISA's yourself.

You can use more than one LISA for a property if you’re buying with someone else and they’re also a first-time buyer. And you can still use your LISA if the other person has previously had a property.

https://becleverwithyourcash.com/lifetime-isas-explained-get-a-25-bonus/#:~:text=A Lifetime ISA is form,£1,000 each financial year.

Again, not wrong, what they say is true and to me doesn't imply that multiple LISAs only apply to buying with someone else.

thomas01155 said:

Wrong info from Barclays:

Accounts are limited to one per person rather than one per home

Barclays: https://www.barclays.co.uk/savings/isas/guide-to-lifetime-isas/ 

I don't see that wording on that page but in any case there is plenty of more accurate and relevant information there:

We don’t offer a Lifetime ISA at the moment, but here’s some information about how they work.

[...]

You can open more than one Lifetime ISA, but will only be able to pay into one in each tax year.

thomas01155 said:

Wrong info on Beehive:

Can I have multiple Lifetime ISAs?
No, unlike other types of ISA, you can’t have more than one Lifetime ISA at any time. If you want to change to a LISA with a different provider you’ll need to transfer your balance over. Once complete, your old provider will close your LISA with them

https://beehive.my.site.com/s/article/Beehive-Lifetime-ISA-Everything-you-need-to-know-including-bonus-payments-and-how-to-withdraw

Agree about that one!

thomas01155 said:

Correct information from HRMC

Oh the irony!

thomas01155

 seskbanker said:

thomas01155 said:

Wrong / confusing information:

"If you've multiple LISAs, you can transfer them all into one LISA before you buy – you can then use the entire amount without penalty, so long as that LISA has been open for at least a year."

You do not need to move all your LISA's into one account before purchasing as stated here, it's fine to leave them with different providers and complete multiple charge free withdrawal forms: https://www.moneysavingexpert.com/savings/lifetime-isas/

Doesn't seem wrong to me, it says you can transfer them, it's not saying that you need to, other than perhaps by the unnecessary inclusion of 'then

The then implies that you will get a penalty if you don't transfer them all into one before you buy. 

Barclays: https://www.barclays.co.uk/savings/isas/guide-to-lifetime-isas/ 


I don't see that wording on that page but in any case there is plenty of more accurate and relevant information there:

The Barclay's page states: 'Accounts are limited to one per person rather than one per home – so 2 first-time buyers can both receive a bonus when buying together.' If you search the page it is under 'Withdrawing from a Lifetime ISA?'

thomas01155

eskbanker said:

thomas01155 said:

Be clever with your cash makes it sound like you can only use more than one if you are buying with someone else, this is also wrong. You can use multiple LISA's yourself.

You can use more than one LISA for a property if you’re buying with someone else and they’re also a first-time buyer. And you can still use your LISA if the other person has previously had a property.

https://becleverwithyourcash.com/lifetime-isas-explained-get-a-25-bonus/#:~:text=A Lifetime ISA is form,£1,000 each financial year.

Again, not wrong, what they say is true and to me doesn't imply that multiple LISAs only apply to buying with someone else.

I agree that people may interpret this differently. I interpreted it like this on the whole as the page does not mention that a solo buyers can use multiple LISAs. If there was another section that stated a solo buyer could use multiple LISAs, then I would have understood this differently.

eskbanker

I wouldn't disagree that some of the wording can be open to interpretation, which is obviously undesirable, but the bottom line, as stated so often on here, is that the definitive position will rarely be available on third party sites like those, so anyone looking for authoritative information on ISA rules should refer to the gov.uk pages.

masonic

It would generally be advisable to combine any LISAs being used towards a property purchase by an individual, as conveyancers are likely to levy a charge per withdrawal they process. This is likely to be an edge case, given that FTB will generally be chasing the best rate and moving all of their money there, or sticking to one out of apathy.