The Lifetime ISA

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

Open a Lifetime ISA

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:

The Lifetime ISA in 90 seconds

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:

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.
  • 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

When can I withdraw money from the Lifetime ISA?

You can withdraw money tax free from the Lifetime ISA when used to purchase your first home worth under £450,000 (see ‘What are the restrictions on the property I can buy with my Lifetime ISA?’), after age 60 or following diagnosis of a terminal illness.

If you choose to withdraw the money at another time, this will count as an ‘unlisted withdrawal’ and will have a 25% government withdrawal charge deducted. This charge could result in you getting back less than you invest.

The charge does not apply if you withdraw money in the 2017/18 tax year. Unless you have been diagnosed with a terminal illness your Lifetime ISA will be closed and no bonus will be claimed.

Can I open the Lifetime ISA alongside other ISAs?

Yes, you can open and pay into other types of ISAs (Cash ISAs, Stocks & Shares ISAs or Innovative Finance ISAs) alongside your Lifetime ISA. As with other ISAs, you will only be able to pay into one Lifetime ISA in each tax year.

You can contribute up to £20,000 across all ISAs in the 2017/18 tax year, of which £4,000 can be contributed to a Lifetime ISA. The government bonus (up to £1,000 per year) will not count towards the £20,000 overall ISA limit or the £4,000 Lifetime ISA limit.

How and when is the government bonus paid?

The government bonus will be claimed by your Lifetime ISA provider from HMRC and automatically added to your account.

For contributions made during the 2017/18 tax year (between 6 April 2017 and 5 April 2018), we will claim your bonus from HMRC in April 2018 and it will be paid into your account by 4 May.

From 6 April 2018 onwards, we will claim the bonus at the earliest opportunity and you will receive the bonus by the 6th day of the following month.

What are the restrictions on the property I can buy with my Lifetime ISA?

You must not own and have never owned a home to be able to use the money in the Lifetime ISA (including the government’s bonus) to purchase your first property.

The property you buy must be in the UK costing up to £450,000. It must also be funded by a mortgage or regulated home purchase plan meaning a cash purchase would not be permitted.

You will need to have had the Lifetime ISA open for at least 12 months to qualify for the government’s bonus. This means you should be looking to purchase your first property after 6 April 2018 at the earliest.

In most cases, the individual must occupy the property as their only or main residence.

Can I open a Lifetime ISA in joint names?

No, you can only open a Lifetime ISA in individual names. This is the same with all ISAs. However, each individual under 40 can open a Lifetime ISA meaning multiple first time buyers (e.g. couples) can benefit from their bonus when they buy together.