How to withdraw money from your Lifetime ISA
You've been saving into your Lifetime ISA and now you’re ready to buy your first home, here are the few steps you need to take to use your savings.
- Download a declaration form provided by HMRC, fill it in and give it to your conveyancer.
- Your conveyancer gives their own declaration to us here at The Nottingham.
- Within 30 days of receiving the conveyancer declaration, The Nottingham will transfer the funds to them.
- Within 10 days of sale completion, the conveyancer will notify us of the details to confirm that the funds have been used.
Can I use my Lifetime ISA with another first-time buyer?
Yes, you can use your Lifetime ISA with another first-time buyer who also has a Lifetime ISA but this isn't compulsory. If you both have a Lifetime ISA, the maximum property value of £450,000 still applies.
Reasons for being charged for withdrawing money from your LISA
If your sale is not complete within 10 days
If your property purchase falls through, your conveyancer must notify The Nottingham and return the funds within 10 days.
If your conveyancer returns less than the amount initially withdrawn
In the event that your conveyancer returns less than the amount you have withdrawn, you will be charged a 20% Government fee on the shortfall amount between now and 5th April 2021. After 5th April 2021 you'll be charged 25%.
If you withdraw money for any reason other than buying your first home or after you’ve reached the age of 60
If you need to withdraw money from your LISA that you’re not putting towards your first home, you will be liable to pay a 20% Government withdrawal fee between now and 5th April 2021 which means you could get back less than you paid in. After 5th April 2021 you'll be charged 25%. There are exceptions to this fee, for example if you are terminally ill, or over the age of 60. You will not incur a fee if you’re using the funds to buy your first home. Discover more about Lifetime ISAs at The Nottingham here, or get in touch with one of our advisers - they'll be happy to help.
If you’re not ready for completing and exchanging just yet and you’re wondering what all the Lifetime ISA fuss is about, check out all you’ll need to know about this product in our #LoveMyLISA Hub.
Last updated on: