Lifetime ISAs guide

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  • Comping_Rich
    Comping_Rich Posts: 20,753 Forumite
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    Do you think first time buyers could use it to buy a house boat / canal boat?

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  • tim_n
    tim_n Posts: 1,607 Forumite
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    Comping_Rich wrote: »
    Do you think first time buyers could use it to buy a house boat / canal boat?

    Generally boat "Mortgages" are just loans - not actual mortgages. That's because boats are an absolute nightmare to finance because they can be fine one day (£100,000) and sunk (£0+scrap) the next. I'm sure someone more knowledgeable will probably say something different, but I wouldnt get your hopes up...
    Tim
  • King_Of_Fools
    King_Of_Fools Posts: 1,592 Forumite
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    In the LISA guide it says:

    A little aside...

    Not to do with your choice, but it's worth taking a look at the real cleverness behind this from the Treasury. If people use a LISA rather than a pension, as it comes from taxed income it gets the Treasury tax revenue now. If people put it in a pension, the Treasury has to wait years until it gets tax. So, this could be Mr Osborne cleverly grabbing cash out of future Chancellors' pockets.

    I do not really understand this because it also says that the bonus is paid at the end of the tax year so surely it is only delaying the tax refund for up to a year.
  • IceSkater10
    IceSkater10 Posts: 1 Newbie
    That's interesting that if you are a couple and one of you owns a house, that the other can use their LISA to purchase another home. Under the new stamp duty rules, wouldn't you both classed as second time buyers in this instance?
  • DanH19
    DanH19 Posts: 1 Newbie
    Hi,


    I have a couple of questions about the soon to be introduced LISAs:


    - If I invest £4k in Y1 (and get £1k on top), and then invest £4k in Y2 (so have £9k in total), will I get a bonus of 25% on £9k or just the £4k that I have invested in Y2?


    - If I merge the amount I have in my H2B ISA when I open a LISA in Apr 17, will I get 25% interest on that at the end of Y1?


    Thanks,

    DanH19
  • Ed-1
    Ed-1 Posts: 3,888 Forumite
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    DanH19 wrote: »
    Hi,


    I have a couple of questions about the soon to be introduced LISAs:


    - If I invest £4k in Y1 (and get £1k on top), and then invest £4k in Y2 (so have £9k in total), will I get a bonus of 25% on £9k or just the £4k that I have invested in Y2?


    - If I merge the amount I have in my H2B ISA when I open a LISA in Apr 17, will I get 25% interest on that at the end of Y1?


    Thanks,

    DanH19

    You just get the 25% bonus on your contributions (up to 4k) each year. However you get the 25% on the full balance of money transferred from a Help to Buy ISA if it is transferred in tax year 17/18. Moreover Help to Buy money deposited prior to 6 April 2017 and transferred into a LISA does not count against the 4k LISA allowance in Y1. So you can get the bonus on a maximum of 8.4k +'any interest transferred over from the Help to Buy ISA in Y1 as 4.4k + interest is the maximum you can transfer over from a Help to Buy ISA without it counting against the LISA allowance.
  • greensalad
    greensalad Posts: 2,530 Forumite
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    edited 23 March 2016 at 1:06PM
    I have a few questions about the new LISA. My debt free date will be early Jan next year, and my partner and I would like to start saving for a house.

    I understand you can only save £4k a year (each). We're looking to save about £2k a month each so obviously we'd fill up own LISA's in about 4 months... so we'd need a plan for what to do after we've filled them.

    Can you still hold a standard ISA alongside a LISA? Is it a separate product like the H2B ISA?
  • Ads1
    Ads1 Posts: 18 Forumite
    I am trying to work out of the LISA would be any good for me.
    I work for a large company who has a defined benefit pension (final salary). I have been paying in to since I was 18. I will be 37 when the LISA in introduced.
    I already have bought my first home. So would only be able to draw on the LISA when I am 60.

    Would it be worth investing in a LISA? and can you have an ISA as well as a LISA? At the moment I have savings in an ISA for maybe one day moving to a bigger property.

    Hopefully someone will have the answers. :)
    Cheers
    Adam
  • Ed-1
    Ed-1 Posts: 3,888 Forumite
    First Anniversary Name Dropper First Post
    greensalad wrote: »
    I have a few questions about the new LISA. MY debt free date will be early Jan next year, and my partner and I would like to start saving for a house.

    I understand you can only save £4k a year (each). We're looking to save about £2k a month each so obviously we'd fill up own LISA's in about 4 months... so we'd need a plan for what to do after we've filled them.

    Can you still hold a standard ISA alongside a LISA? Is it a separate product like the H2B ISA?

    The H2B ISA isn't a separate product - it's a cash ISA so you can only pay into one cash ISA per year. The lifetime ISA however is a separate product so you can pay into that and a cash ISA in the same year.
  • jimjames
    jimjames Posts: 17,596 Forumite
    Photogenic Name Dropper First Anniversary First Post
    IceSkater10 wrote: »
    That's interesting that if you are a couple and one of you owns a house, that the other can use their LISA to purchase another home. Under the new stamp duty rules, wouldn't you both classed as second time buyers in this instance?
    Not if it's to buy a replacement to live in. It can't be used to buy a house on a BTL mortgage.
    Remember the saying: if it looks too good to be true it almost certainly is.
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