LISA questions - tax years and buying with partner who has a Help to Buy ISA

Hi,

I have a Help to Buy ISA which, with projected interest payments and the full £200/month top up, will be maxed out in around June 2026, which due to rental terms is when my partner and I are aiming to buy.

I am considering changing to a LISA predominantly as I am getting concerned that with the market set to get better next year, we don’t want to be restricted to the £250k budget to be eligible for the bonus. I am also confident of being able to have joint savings of around £30,000 so could, pending no drops in household income, look to buy at say £300k with a 10% deposit.

Assuming I do max out my HTB, this would give me the full £3,000 government bonus. If I were to buy in mid 2026 but instead using a LISA and assuming I was able to pay in £16,000 using both what’s in my HTB and contributing more per month, would I be eligible for a £4,000 government bonus as I would be paying in four separate tax years (2023/24, 24/25, 25/26 and 26/27) or because I’d only be paying in £4,000 at the very start of the 26/27 would this mean I am not eligible for that years government bonus as I’d have to wait until the end?

I’ll also be buying with my partner who is going to be contributing to his savings from next month. If we were to both use different accounts (e.g. I used a LISA and he used at HTB), would be both be eligible to use our respective 25% bonuses towards the house deposit, or can only one of us use the bonus?

Thanks if anyone can help!

Comments

  • masonic
    masonic Posts: 22,909
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    edited 26 December 2023 at 8:10PM
    The government bonus is paid 1-2 months in arrears, so for your 26/27 deposit, if made in April 2026, should be received before the end of May, so it could be claimed with the rest of the LISA funds thereafter. If he used a HTB ISA, he'd only be able to claim his bonus if the house purchase met the requirements of both schemes (i.e. <£250k value).
  • You and your partner's accounts are not linked - therefore, you both can get the 25% bonus for the house purchase provided that you are both first-time buyers (if one of you already owned a house, then only the person who was a first-time buyer could claim the bonus). If you are thinking of buying a house that is 300K, then it makes no sense for your partner to pay into a HTB ISA as he wouldn't be able to claim the bonus (due to the house value). He should also pay into a LISA (if he is eligible e.g. under 40). If he is not eligible for a LISA, then he would need to consider how likely it is that the house would exceed the HTB ISA limit - the main benefit of the HTB ISA is the bonus... if he is not going to get the bonus, then HTB ISA interests are not competitive. 
  • Thank you both for your responses, much appreciated.

    We are both 24 so eligible for a LISA so definitely think it's worth me transferring mine to a LISA and topping that up and my partner starting to save into one.
  • Apologies, a question I forgot to ask. Do LISA providers (particularly Moneybox which I will most likely be choosing) pay interest on the government bonus? So I say I transferred £4,000 into a LISA tomorrow and the bonus of £1,000 paid out in February, would I accumulate interest just on the £4,000 I put in or the full £5,000 balance from February onwards? Thanks :)
  • masonic
    masonic Posts: 22,909
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    They pay interest on the balance of the account, so they will pay it on the bonus once it is credited to the account.
  • masonic said:
    They pay interest on the balance of the account, so they will pay it on the bonus once it is credited to the account.
    Thank you!
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