Apr 13, 2016 PROPERTY SALES SHARE

Can the new Lifetime ISA help first time buyers?


POSTED IN PROPERTY SALES

From April 2017 any adult aged between 18 and 40 will be able to open a new Lifetime ISA account. You can save up to £4,000 a year and receive a 25% bonus from the Government on this money on any savings before your 50th birthday. The money saved in this account can be withdrawn to help buy your first home or saved until you are over 60 for retirement income.

These savings and bonus can be used towards a deposit of a first home worth up to £450,000 across the country. Couples, who are both first time buyers, can open an account each and both receive the benefit as the account is limited to one per person rather than one per home.

Savings from the previous Help to Buy ISA can be transferred into the Lifetime ISA account in 2017 or you can continue saving in both accounts separately but you can only use the bonus from one account to buy a house.

Alternatively the Lifetime ISA can be saved for retirement, you can take out all the savings, tax exempt, after your 60th birthday.

You can withdraw the money at any time before your 60th birthday but will lose the Goverment bonus and any interest on this. You will also have to pay a 5% charge.

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