Saving for later life with your Lifetime ISA
Find out how you can continue to save in a LISA after you’ve bought a first home
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A Lifetime ISA (LISA) isn’t just for saving for your first home. You could also use a Lifetime ISA to save for later life.
You don’t have to withdraw all the money in your LISA to buy your first home. There is the option for you to leave some of the money and keep making regular payments until you turn 50 and receive the government bonus. After this, your savings will still have the opportunity for any potential investment gains.
After age 60, you can withdraw the money you have saved without a penalty.
How to access my Lifetime ISA
To access the money in your Lifetime ISA for the purchase of your first home, you will need to contact Customer Services so that they can provide you with the relevant forms and let you know the current value of your Lifetime ISA element.
You will receive two forms, the Lifetime ISA House Purchase Investor Declaration form, which you will need to complete and provide to your conveyancer; and the Lifetime ISA Conveyancer Declaration form, which your conveyancer will complete. Once both of these forms have been completed your conveyancer will send them to us.
You may also wish to check your Plan value which you can do by logging in to your online My Plans account.
Once we have received the forms, and we are happy with the information provided, we will make the payment of the requested withdrawal amount directly to your conveyancer. If the purchase of the home is completed within 90 days your conveyancer will inform us.
Please note if you are purchasing your first home with someone else and they have a Lifetime ISA then they will need to go through this process as well and your conveyancer will manage this. If your house purchase is not completed within 90 days of receiving the money, you can apply for a 60 day extension, and then another 30 days. However if the purchase still hasn’t gone through after this, the Lifetime ISA money must be returned to us otherwise the 25% Government penalty will apply.
Do I need to make a full withdrawal?
No, you choose how much of your Lifetime ISA element you would like to encash for your home purchase. You can make several withdrawals between the initial deposit and completion of the purchase, however HMRC rules require us to have the completed Investor Declaration and Conveyancer Declaration for every withdrawal.
What happens to my Lifetime ISA after the house purchase is complete
Once the purchase has been completed if you have money left over in your Lifetime ISA element, or you continue to make monthly contributions into your Lifetime ISA element, then it will remain open. You will receive the Government Bonus on contributions made up to the age of 50 and gain access to the money from your 60th birthday onwards (otherwise the Government penalty will apply).
If you encash the full value of your Lifetime ISA element, and you do not have a Direct Debit contributing to this element, your Lifetime ISA will close. If you plan to save for later on in life, then you may want to leave some money in the Lifetime ISA element.
