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Lifetime ISA

The Lifetime ISA

Get a £1,000 government bonus each year towards your first home or later life.

Watch: The Lifetime ISA in 90 seconds

The Lifetime ISA in 90 seconds

Important information - please remember that the value of investments, and any income from them, can fall as well as rise so you could get back less than you invest. If you are unsure of the suitability of your investment please seek advice. Tax rules can change and the value of any benefits depends on individual circumstances. Investing should be considered over the long-term. Money in a Lifetime ISA can be withdrawn to purchase a first home or at age 60. Early withdrawals will usually be subject to a 25% penalty.

What is the Lifetime ISA?

The Lifetime ISA offers a flexible way for adults under 40 to save for their first home or later life with a boost from the government. In a Lifetime ISA you can:

  • Contribute up to £4,000 each year
  • Get a 25% government bonus (up to £1,000 each year) on any contributions before your 50th birthday
  • Withdraw the money tax free when used to buy your first home or after age 60
  • Choose to save as cash or invest in the stock market

Download our free Lifetime ISA factsheet

Why choose Hargreaves Lansdown?

In the HL Lifetime ISA you can invest in the stock market to grow your money and potentially reach your goals quicker. Although investments can go down as well as up so you could get back less than you invest. Benefit from:

  • Peace of mind – choose the UK’s leading investment platform, already trusted by over 876,000 clients with £70 billion
  • Expert guidance – see the latest research and investment ideas from our experts to help you choose from a range of investments.
  • Easy to manage – keep up-to-date with your investments online or using our new app for mobile
  • Great value – no set-up or transfer-in charges, no charges for buying or selling funds, low cost reinvestment service and an annual fee of just 0.45% or less. See our charges.

Open a Lifetime ISA Transfer to a Lifetime ISA

When can I withdraw the money?

Buying your first home

  • The property must cost £450,000 or less and be in the UK
  • The Lifetime ISA must have been opened for at least 12 months to benefit from the government's bonus
  • The bonus is per individual so two first time buyers (e.g. couples) can both use their bonus when buying together

After your 60th birthday

  • Withdraw the money tax free after age 60 and spend however you choose
  • The Lifetime ISA is designed to complement a pension when saving for your future. See our Lifetime ISA vs pension comparison table
  • If you decide to opt out of your workplace pension to pay into a Lifetime ISA, you will not benefit from any employer-matched contributions and it may affect your current and future entitlement to means-tested state benefits

Withdrawing the money early

If you withdraw the money before age 60 and it’s not to purchase your first home, you'll pay a 25% government withdrawal charge on any money you withdraw (except if you’re diagnosed with a terminal illness). This means you may get back less than you put in. For withdrawals made in 2017/18 tax year (between 6 April 2017 and 5 April 2018), this charge does not apply, although you will not receive any government bonus either.

Opening a Lifetime ISA with HL

You can open an HL Lifetime ISA online in minutes and benefit from an easy-to-manage account with award-winning service. Simply:

  1. Make a payment
    Open with a lump sum of £100, or start saving from as little as £25 a month.
  2. Choose your investments
    Or open your Lifetime ISA with cash and choose your investments later.

Open a Lifetime ISA

Transfer to a Lifetime ISA

Frequently asked questions







Lifetime ISA Pension (Basic rate taxpayer) Pension (Higher or additional rate taxpayer)
What is the account likely to be used for? Purchasing your first home and/or retirement Retirement Retirement
Am I eligible? Yes, if you will be a UK resident and aged between 18 and 39 Yes, if you are a UK resident Yes, if you are a UK resident
How much can I contribute? Up to £4,000 Up to as much as you earn, effectively capped at £40,000 each year in most cases. See more about pension contributions Up to as much as you earn, effectively capped at £40,000 each year in most cases. See more about pension contributions
What is the government’s contribution? 25% bonus on contributions (up to £1,000 a year) 20% tax relief on contributions Up to 45% tax relief
Can I withdraw all the money tax free? Yes – when purchasing your first home or after age 60 No – only up to 25% of withdrawals are usually tax free and the rest is taxed as income No – only up to 25% of withdrawals are usually tax free and the rest is taxed as income
When can I take the money out? Whenever you like. However, if you choose to use the funds other than for the purchase of your first home or after age 60, there is a 25% penalty Usually from age 55 (57 from 2028) Usually from age 55 (57 from 2028)
What are the tax benefits? 25% bonus on contributions under age 50 (up to £1,000 a year) - Tax free growth - No UK tax on income - Tax free withdrawals for house purchase or after age 60 Up to 20% tax relief on contributions under age 75 - Tax free growth - No UK tax on income - Up to 25% of withdrawals usually tax free Up to 45% tax relief on contributions under age 75 - Tax free growth - No UK tax on income - Up to 25% of withdrawals usually tax free
Will my employer make a contribution? Potentially. If they do the contributions will be subject to tax and national Insurance. Yes – if you are contributing through a workplace pension Yes – if you are contributing through a workplace pension
Where can I invest? Choose your own investments from funds, shares, bonds, cash, ETFs and more Choose your own investments from funds, shares, bonds, cash, ETFs and more Choose your own investments from funds, shares, bonds, cash, ETFs and more

Tax rules can change and the value of any benefits depends on individual circumstances.