Posted by Malcolm Wallace | July 20, 2016
Step forward the new Lifetime ISA!
You can save money in a tax free environment, up to £4,000 each year, and receive a government bonus of 25% – that’s a bonus of up to £1,000 a year. You can use some or all of the money to buy your first home, or keep it until you’re 60 – it’s up to you.
- You can open a Lifetime ISA account between the ages of 18 and 40, and
- Any savings you put into it before your 50th birthday will receive an added 25% bonus from the government
- Accounts will be available from April 2017
- You can save as little or as much as you want each month, up to £4,000 a year
- The total amount you can save each year into all ISAs will also be increased from £15,240 to £20,000 from April 2017
- If you withdraw the money before your 60th birthday you will lose the bonus and an interest/growth on this.
- A further 5% penalty charge will also have to be paid so consider any withdrawals carefully.
- They are also limited to one account per person.
- The £4,000 is part of the total annual limit of £20,000.
We like it when the tax man gives us money, so if you’re saving for your first home, or want to bolster your retirement savings, come and talk to us!