LISA - criteria for withdrawal

sparky1983

My wife is looking to use her LISA to purchase her first home however she has a 25% share in a property partnership that was setup to buy a commercial property. We've since bought the flat above within the same partnership which we rent out but never lived in. We live together in our family home which is solely in my name. I know she won't qualify as a first time buyer as far as stamp duty goes on the second home but our accountant thinks she can still use her LISA to buy her first home. What do other people think, will she qualify? The new property would be in joint names and would be our main residence and we then sell my first property.

eskbanker

sparky1983 said:

she has a 25% share in a property partnership that was setup to buy a commercial property. We've since bought the flat above within the same partnership which we rent out but never lived in.

"an individual who owns as sole or joint owner an interest in residential property" isn't considered a first time buyer for the purposes of LISA:

https://www.legislation.gov.uk/uksi/1998/1870/schedule/paragraph/7

sparky1983 said:

our accountant thinks she can still use her LISA to buy her first home. What do other people think, will she qualify?

It'll perhaps be worth getting the expert opinion of a property conveyancer, rather than an accountant, regarding eligibility based on the specified criteria - personally I'd see it as unlikely but don't have any experience of the legal structure of such partnerships.

masonic

She would have been fine until the acquisition of the flat, as that was presumably a residential property.

Alexland

sparky1983 said:

We've since bought the flat above within the same partnership which we rent out but never lived in.

Am I correct in understanding that your property partnership is not a legal entity and therefore the property is still owned by the partners in trust for the partnership? If so you hold legal title to a residential property and are not first time buyers.

sparky1983

Just an update that I believe it is it's own legal entity as it has its own tax reference so my accountant still thinks it's possible. Also she would qualify as a first time buyer for stamp duty if the house and mortgage are fully in my wife's name and we buy and sell on the same day. Thanks for everyone's input.