Lifetime ISAs guide

Also you don't claim the bonus. Your provider will automatically claim the bonus(s) on your behalf based on each contribution date and add it into the account.

jadada1234 wrote: »

I am due to get interest on my Help 2 Buy ISA with Halifax this month. Does this interest count towards the £4,000 max on transfer into a LISA with Skipton or can the interest count in addition to the £4,000?

A bit of both - the interest for the period from December 2016 to 5 April 2017 doesn't count towards the £4K LISA allowance for 2017/18 but the rest does. Halifax should do the calculation when transferring to Skipton....

hbell86 wrote: »

Bit of background needed. I've had a stocks and shares LISA since they launched. I now want to transfer this into a cash LISA. I then also want to transfer my help to buy ISA to the same cash LISA. So that all of my savings for my first home are together.

Is this possible?

Yes, as long as your total 2017/18 contributions across all these accounts are less than £4K.

timeforchange6 wrote: »

I'm a bit confused and am hoping someone here can clarify...

If i put 4k into a lifetime isa before the end of the tax year will i get the full 1k or is it based on when it was paid in?

Also I see it's changing to monthly, how is this calculated? What happens if i put 4k at the start of the year compared to putting 4k in just before the end of the tax year?

Thanks for the help in advance.

Contributions made this tax year will earn a 25% bonus payable at the start of the next tax year, regardless of how long they've been in the account (as it's not interest), so if you pay £4K in anytime before 5 April 2018 you'll get the £1K bonus in late April or maybe early May 2018.

From the 2018/19 tax year the bonus will be payable monthly, based on contributions made during the previous month*, so if you paid £4K in in April 2018 you'd get £1K in May 2018, or if you pay £4K in in March 2019 you'll get the £1K bonus in April 2019.

* The monthly periods are actually 6th of one month to the 5th of the following month, i.e. aligned with the tax year dates....

tommysaver wrote: »

That's really helpful - thanks! Given the dates you have given above...

Would the best thing to do be.... to open the Skipton LISA say Feb/March 2018 to be safe, dump my £4k in, then come the tax year April 2018 = free £1k bonus.

[total now 5k]

Then... in march time 2019.. put in another 4k march time, boom?

[total now 10k]

That way I can keep the money in other accounts before putting it into the LISA. Winner?

Also one other question: What happens to the 0.75% interest? Say I have £4000 in March, bonus up to £5k in April. Next April, (2019) £5k would have been in there for 1 year = a massive £37.50 at 0.75%. ?

Many thanks!

Yes, exactly that. Most of us are taking advantage of regular savers etc with higher interest rates and then plan to drop in as last minute as poss. However - Skipton have announced they are not accepting any HTB transfers after 1 March, in order to make sure they can process all of them before end of tax year. So I wouldn’t wait until then in case there are any issues. I’ve actually started transferring mine now - hoping it will be complete by next week. Yes I’m missing out on a couple of months interest on my HTB (which was 3.5%) but its nominal, for peace of mind.

Re you interest query, yes that’s basically it. No one’s opened the Skipton account for the amazing interest rate; in fact we’re all ditching a good one for it. But you can’t beat 25% free money so. Perhaps other banks will start to offer this and interest rates will get competitive but at the moment, just forget about the 0.75% and it’ll be a fun surprise It’s in addition to your 4K allowance.