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  • FIRST POST
    • Hilly1990
    • By Hilly1990 3rd Mar 18, 2:36 PM
    • 15Posts
    • 12Thanks
    Hilly1990
    Lifetime ISA
    • #1
    • 3rd Mar 18, 2:36 PM
    Lifetime ISA 3rd Mar 18 at 2:36 PM
    I currently hold a Lifetime Isa with Skipton Building Society and have put 4000 in a few months ago which I believe will give me the government bonus of 1000.

    To receive the bonus for the next tax year 2019, am I able to pay an additional 4000 in around February time or would this have to be spread throughout the year?
Page 1
    • bowlhead99
    • By bowlhead99 3rd Mar 18, 2:41 PM
    • 7,991 Posts
    • 14,536 Thanks
    bowlhead99
    • #2
    • 3rd Mar 18, 2:41 PM
    • #2
    • 3rd Mar 18, 2:41 PM
    I currently hold a Lifetime Isa with Skipton Building Society and have put 4000 in a few months ago which I believe will give me the government bonus of 1000.

    To receive the bonus for the next tax year 2019, am I able to pay an additional 4000 in around February time or would this have to be spread throughout the year?
    Originally posted by Hilly1990
    You can pay it in whenever you like in as many seperate lumps as you like up to 4000 total; as long as your payment(s) don't go in before 6 Apr 2018 and don't clear after 5 April 2019 they will count as 2018/19 tax year subscription.
    • ValiantSon
    • By ValiantSon 3rd Mar 18, 3:22 PM
    • 2,049 Posts
    • 1,899 Thanks
    ValiantSon
    • #3
    • 3rd Mar 18, 3:22 PM
    • #3
    • 3rd Mar 18, 3:22 PM
    I currently hold a Lifetime Isa with Skipton Building Society and have put 4000 in a few months ago which I believe will give me the government bonus of 1000.

    To receive the bonus for the next tax year 2019, am I able to pay an additional 4000 in around February time or would this have to be spread throughout the year?
    Originally posted by Hilly1990
    I agree with everything bowlhead99 has said. I'd only add that given the interest rate is so low on the cash LISA you might as well wait until the start of April (rather than in February) to pay the 4,000 in and benefit from a better interest rate elsewhere. The extra won't be a huge sum, but it is better than not getting it.
    • sully1311
    • By sully1311 3rd Mar 18, 3:52 PM
    • 58 Posts
    • 13 Thanks
    sully1311
    • #4
    • 3rd Mar 18, 3:52 PM
    • #4
    • 3rd Mar 18, 3:52 PM
    Yep, I opened up 2 Lifetime ISAs in January and put the max in straight away. I have the max again for the next financial year but they're currently in various easy access and regular savings account getting better interest for a year before they are put into the Lifetime ISA next year March sometime.

    The best option is just to put your money in a better interest account for the year and then depositing it in the Lifetime ISA before the end of the next tax year in 2019.
    • ValiantSon
    • By ValiantSon 3rd Mar 18, 4:08 PM
    • 2,049 Posts
    • 1,899 Thanks
    ValiantSon
    • #5
    • 3rd Mar 18, 4:08 PM
    • #5
    • 3rd Mar 18, 4:08 PM
    Yep, I opened up 2 Lifetime ISAs in January and put the max in straight away. I have the max again for the next financial year but they're currently in various easy access and regular savings account getting better interest for a year before they are put into the Lifetime ISA next year March sometime.
    Originally posted by sully1311
    I hope that this is a typing error. You can only subscribe to one LISA in any tax year. If you have opened two in January and paid into two this year then you are in breach of the rules and HMRC will be in touch.
    Last edited by ValiantSon; 03-03-2018 at 4:19 PM. Reason: Typo
    • Ak92
    • By Ak92 3rd Mar 18, 4:15 PM
    • 26 Posts
    • 3 Thanks
    Ak92
    • #6
    • 3rd Mar 18, 4:15 PM
    • #6
    • 3rd Mar 18, 4:15 PM
    So if I use my LISA to buy my first home, will I still be able to use the account to save for my retirement and still get the government bonus?
    • ValiantSon
    • By ValiantSon 3rd Mar 18, 4:19 PM
    • 2,049 Posts
    • 1,899 Thanks
    ValiantSon
    • #7
    • 3rd Mar 18, 4:19 PM
    • #7
    • 3rd Mar 18, 4:19 PM
    So if I use my LISA to buy my first home, will I still be able to use the account to save for my retirement and still get the government bonus?
    Originally posted by Ak92
    Yes. You can use it for both purposes.
    • bowlhead99
    • By bowlhead99 3rd Mar 18, 4:22 PM
    • 7,991 Posts
    • 14,536 Thanks
    bowlhead99
    • #8
    • 3rd Mar 18, 4:22 PM
    • #8
    • 3rd Mar 18, 4:22 PM
    So if I use my LISA to buy my first home, will I still be able to use the account to save for my retirement and still get the government bonus?
    Originally posted by Ak92
    Yes, as long as when you take the money out of your LISA to buy the home you don't close it, but keep it going with a few pounds in, you can carry on using it.

    If you're still under 40 at that point you could just open up another one of course. But if you'll be over 40 you won't be eligible to open up another one (other than by transfer) so you would need to keep the first one running after taking out your property money.
    • k12479
    • By k12479 4th Mar 18, 1:15 AM
    • 400 Posts
    • 660 Thanks
    k12479
    • #9
    • 4th Mar 18, 1:15 AM
    • #9
    • 4th Mar 18, 1:15 AM
    ...you might as well wait until the start of April (rather than in February) to pay the 4,000 in and benefit from a better interest rate elsewhere.
    Originally posted by ValiantSon
    It's worth remembering that this tax year the bonus is paid at the end while from the next tax year the bonus is paid monthly. That's still unlikely to change the validity of the advice above though.
    • Hilly1990
    • By Hilly1990 4th Mar 18, 5:56 PM
    • 15 Posts
    • 12 Thanks
    Hilly1990
    It's worth remembering that this tax year the bonus is paid at the end while from the next tax year the bonus is paid monthly. That's still unlikely to change the validity of the advice above though.
    Originally posted by k12479
    If that's the case, would I need to put the whole 4000 in at the beginning of the year to benefit from the full 1000 bonus?
    • Alexland
    • By Alexland 4th Mar 18, 5:58 PM
    • 2,610 Posts
    • 1,983 Thanks
    Alexland
    No you can put the money anytime during the tax year. If you put it in earlier you get the bonus paid earlier.
    • 6022tivo
    • By 6022tivo 4th Mar 18, 8:29 PM
    • 548 Posts
    • 130 Thanks
    6022tivo
    So, you get 25% government bonus at year one, then nothing for the rest of the time it is in the account. So over year after year, that 25% just dilutes?
    Last edited by 6022tivo; 04-03-2018 at 8:43 PM.
    • Alexland
    • By Alexland 4th Mar 18, 8:31 PM
    • 2,610 Posts
    • 1,983 Thanks
    Alexland
    So, you get 25% government bonus at year one, then nothing for the rest of the time it is in the account. So over year after year, that 25% does not increase?
    Originally posted by 6022tivo
    Yup you only get a 25% bonus on a contribution once. For the rest of the time you are relying on the Cash ISA compound interest or S&S LISA investment return.

    So if you add 4k in year 1 you get 1k, add 4k in year 2 you get another 1k, etc.
    • 6022tivo
    • By 6022tivo 4th Mar 18, 9:15 PM
    • 548 Posts
    • 130 Thanks
    6022tivo
    The more I think about it, it a bit pants isn't it?
    0.1% from Skipton is it??

    The HTB was probably better as you get the interest every year, then 25% when you buy the house?
    I shouldn't have transferred..
    • Alexland
    • By Alexland 4th Mar 18, 9:22 PM
    • 2,610 Posts
    • 1,983 Thanks
    Alexland
    The more I think about it, it a bit pants isn't it?
    0.1% from Skipton is it??

    The HTB was probably better as you get the interest every year, then 25% when you buy the house?
    I shouldn't have transferred..
    Originally posted by 6022tivo
    Well the main advantages of the LISA are that you can add a further 1600 per year (4000 versus 2400) for a bigger 25% bonus and also that you can buy a house up to 450k nationwide. However if these are not of use to you then you might have been better staying with a HTB ISA.

    ps the interest on Skipton is 0.75%

    Alex,
    Last edited by Alexland; 04-03-2018 at 9:24 PM.
    • maddoglewis
    • By maddoglewis 5th Mar 18, 6:15 AM
    • 43 Posts
    • 15 Thanks
    maddoglewis
    I'm transferring my HTB ISA into a LISA to take advantage of the extra bonus available for the 17/18 tax year. What I don't understand is why this years interest accrued in my HTB ISA counts towards the 4000 maximum LISA contribution. So, if I have paid in 2400 this year and received 100 interest, I can only pay 1500 into my LISA before the end of this tax year, is that right?
    • 6022tivo
    • By 6022tivo 5th Mar 18, 7:19 AM
    • 548 Posts
    • 130 Thanks
    6022tivo
    Nope. I believe you can transfer in everything Inc interest from your htb, and also add 4k before April and get the 25% on the lot.
    • maddoglewis
    • By maddoglewis 5th Mar 18, 7:38 AM
    • 43 Posts
    • 15 Thanks
    maddoglewis
    Nope. I believe you can transfer in everything Inc interest from your htb, and also add 4k before April and get the 25% on the lot.
    Originally posted by 6022tivo
    Not if you've already contributed into the HTB ISA this tax year though.
    • BenZaff
    • By BenZaff 5th Mar 18, 9:27 PM
    • 1 Posts
    • 0 Thanks
    BenZaff
    If I open a cash LISA today and deposit 4000, will I get 1000 government contribution at end of March 2019 if I buy a house then? And if I deposit another 4000 in a exactly a years time in March 2019 will I get a further 1k in April 2019 at beginning of new tax year, (I.e 1k for 2017-2018 and 1k for 18-19)? Or will I just get 1k in April 2019 and monthly payments on the new deposited balance of the 19-20 tax year?
    • eskbanker
    • By eskbanker 6th Mar 18, 12:09 AM
    • 7,446 Posts
    • 8,030 Thanks
    eskbanker
    If I open a cash LISA today and deposit 4000, will I get 1000 government contribution at end of March 2019 if I buy a house then?
    Originally posted by BenZaff
    No, if you pay in 4,000 before the end of the tax year on 5 April 2018, you'll receive the 1,000 bonus around the end of April 2018.

    And if I deposit another 4000 in a exactly a years time in March 2019 will I get a further 1k in April 2019 at beginning of new tax year, (I.e 1k for 2017-2018 and 1k for 18-19)? Or will I just get 1k in April 2019 and monthly payments on the new deposited balance of the 19-20 tax year?
    Originally posted by BenZaff
    Sounds like you've probably misunderstood the timing of contributions and bonus payments - you can pay in up to 4K every tax year (not every 12 month period from opening) and will receive a 25% bonus about 4-8 weeks after you've done so. If you started one with 4K before 5 April 2018, you could pay in another 4K on 6 April 2018 and get a second bonus of 1K around the end of May 2018.
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