Money Advice Service

Want to know more about Lifetime ISAs? In this guide, we answer some of the most frequently asked questions.

Do my Lifetime ISA savings count towards my ISA limit for the year?

You can put a maximum of £4,000 into a Lifetime ISA each tax year.

Yes. Any money put into a Lifetime ISA will eat into the overall ISA limit for that year.


In the 2018/19 tax year, the ISA allowance is £20,000. If you put £1,000 into a Lifetime ISA, your remaining allowance, across all ISA products, is £19,000.

Transferring money from a different ISA

If you transfer money from a different type of ISA (for example, a cash ISA, a stocks and shares ISA or an innovative finance ISA, which you invested in a previous tax year, into a Lifetime ISA, it will affect the annual £4,000 Lifetime ISA allowance, but not your overall ISA limit because it was already in an ISA.


During the 2017/18 tax year, you invested £1,000 in a Cash ISA and then transferred it to your Lifetime ISA in the 2018/19 tax year.

In this scenario, your remaining allowance for your Lifetime ISA for the 2018/19 tax year is £3,000, but your overall ISA allowance for the tax year remains £20,000.

Are transfers from another ISA eligible for the government bonus?

Yes. Transfers to a Lifetime ISA from a previous year’s:

  • cash ISA,
  • stocks and shares ISA
  • innovative finance ISA

are all eligible for the government bonus and will not count against the £20,000 overall ISA limit for the 2018/19 tax year in which the transfer takes place.

However, these transfers do count towards the annual £4,000 Lifetime ISA contribution limit.

Is there a limit on the size of bonus you can get?

The maximum bonus you can get in a year is £1,000 (25% of the £4,000 maximum yearly contribution).

If you open your Lifetime ISA when you turn 18 and contribute £4,000 a year, until you’re 50, you could earn up to £32,000 in bonuses.

Minimum contribution

The government has not set a minimum amount you need to save to get a bonus. However, your provider might have a minimum investment to open a Lifetime ISA.

How is the bonus calculated?

The bonus will be 25% of the amount you pay in, not including investment interest or investment growth.

This means that if you invest £4,000 in a year, but your investment goes down in value before the claim is made, you’ll still be entitled to a bonus of £1,000 that year.

How do I claim the bonus?

Your Lifetime ISA manager will claim the bonus from HMRC for you and add it to your Lifetime ISA.

You don’t need to claim yourself.

When is the bonus paid?

From April 2018, the bonus will be paid each month after you put money in it.

Will I get interest on my government bonus?

Yes. Once a bonus is paid into your Lifetime ISA, you can invest it just like your other ISA savings.

Is the property I’m buying eligible for the government bonus?

To be able to withdraw your Lifetime ISA savings, including the government bonus, the property you are buying must:

  • be in the UK
  • cost £450,000 or less
  • be the only home you own
  • be where you intend to live, and
  • be purchased with a mortgage.

Can I use my Lifetime ISA with other government housing schemes?

Yes. You can use your Lifetime ISA with other government schemes, such as the Help to Buy: Equity Loan scheme.

Details of Government housing schemes can be found on the Government’s Own Your Home website.

I want to buy a first home with somebody else. Can we both use a Lifetime ISA?

Yes. You can each use Lifetime ISA savings to buy your first home, provided you both meet the eligibility criteria.

If only one of you meets the eligibility criteria, for example, if one of you already owns a property, then only the person who meets the criteria can use their Lifetime ISA funds.

Can I open a Lifetime ISA and then buy a house immediately with a government bonus?

No. You can only withdraw funds from your Lifetime ISA (without paying a charge) to purchase a first home, at least 12 months after putting money in your Lifetime ISA.

This applies to each Lifetime ISA that you open, but it does not apply to Lifetime ISA transfers.

For example, if you open a Lifetime ISA with a bank in May 2018, and transfer the account to another bank in October 2018, the 12 month period starts from May 2018.

Can I transfer my Help to Buy: ISA into a Lifetime ISA?

Yes, but the amount transferred in will count against the £4,000 LISA maximum. So, if you transfer in £1,000 after 6 April 2018 you’ll only be able to put in £3,000 to your LISA for the tax year 2018-19.

Can I use my Lifetime ISA bonus for my exchange deposit?

Yes. Lifetime ISA funds, including the bonus, can be put towards an exchange deposit.

However, the property purchase must be completed within 90 days of your conveyancer receiving the withdrawn funds from your Lifetime ISA manager.

What happens if I become terminally ill?

If you become terminally ill and have less than 12 months to live, you will be able to withdraw some or all of the funds (including the bonus) without any withdrawal charge, regardless of your age.

You will need to provide your ISA manager with evidence from a registered medical practitioner that you are expected to have less than 12 months to live.

A registered medical practitioner must be fully registered with the General Medical Council and have a licence to practice medicine.

More information on Lifetime ISAs

This article is provided by the Money Advice Service.