We love the Lifetime ISA!

  • by Carole Jordan
  • 10 Apr, 2017

Young people in the UK rejoice! From 6th April a new tax free savings account will be available for UK residents aged between 18 and 40 years.  The Uk government will also contribute to the fund which must be used either for the first time property purchase or for retirement.

What could the Lifetime ISA mean for you?

The Lifetime ISA allows you to save up to £4,000 per year, which can be in cash and stocks and shares, in whatever proportion suits you. 

The UK government will contribute an additional 25% each year until you use the funds to buy your first property. You must use a solicitor for this and the funds are paid direct to them for the property purchase. You must also use mortgage lending to purchase the property. 

If your aim is to save for retirement, the funds become available with the government bonus added, when you are 60 years of age. 

So for those in the right age bracket this looks like a great deal!

Can you have a help to buy ISA & a Lifetime ISA?

If you already have a ‘help to buy ISA’ you can transfer the whole balance before 5th April 2018 if you wish, or run both alongside each other. From 6th April you’ll be able to only transfer £4,000 of your Help to Buy Isa each year, which will use up your allowance. 

There is now a variety of ways to save tax effectively and also to boost your returns with interest rates so low. The total ISA savings limit for 2017/18 is £20,000 and this can be deposited in a combination of the original cash or shares ISAs, the existing Help to Buy ISA and now the new LISA. 

Remember to also consider normal savings and investment options as returns may be higher and interest has been tax free to a limit of £5,000 from 6th April 2016.

 So now is the time to take a good look at your savings, look for the best savings rates, be sure you’re making the most of the schemes available, getting any bonuses you qualify for and keeping your tax liability down. 

For more information check out the HMRC Lifetime ISA pages .


All details above were correct at the time of publishing - for more up to date information please   get in touch .

You might also be interested in...

If you enjoyed the blog, why not leave us a comment, or share it with a friend...

Free advice delivered to your inbox

Browse our other blog posts...

Our latest blog

by Carole Jordan 19 Jan, 2018

It’s always nice to reward your employees, especially those who may have worked for your business for a long time. Find out how you can do this and still reap the tax benefits.

by Carole Jordan 12 Jan, 2018
Now, more than ever, exporting across the world offers an opportunity not seen for many decades. 

If you want to grow your exports then the government want to help you on your way with Finance, Insurance and opportunities to meet potential customers. Yippee!

by Carole Jordan 08 Jan, 2018

There’s a hidden gap in skills and knowledge between those of us who are qualified Accountants, and those who refer to themselves as Accountants.  Every day we make an investment in your business to ensure you receive the quality of advice you need to protect your business.

by Carole Jordan 03 Jan, 2018

It’s January and its ‘National Pay Your Self-Assessment Tax Month’!
Your tax return should be safely in the HMRC net now but if you didn’t file before 12th December you will not receive a statement and payslip in the post. In any case, it’s best to brace yourself for making the payment as the statements are drip feeding very slowly through the postal system as I write.

by Carole Jordan 15 Dec, 2017
An easier way to pay your impending tax bill could be through your PAYE tax code. Find out if you qualify and how you can go about setting this up.
More posts
Share by: