The Treasury has announced that Lifetime ISA holders will be able to close their accounts and access all of their savings without charge to help fund the deposit on their first home.
Before completing the transaction, conveyancers will apply for the 25% government bonus on behalf of the client. The bonus amount will subsequently be added to the amount in the deposit. Paying the funds from the government into the account is contingent on the property being purchased fulfilling eligible housing transaction criteria.
The Treasury has also confirmed that from 2018-19 the bonus will be paid monthly.
In a technical note released today, the government said: “The Lifetime ISA and the Help to Buy: ISA are different products with different purposes. The Help to Buy: ISA is a short-term savings product targeted at supporting people buying their first home.”
“If you have a Help to Buy: ISA you can transfer those savings into the Lifetime ISA in 2017-18, or continue saving into both – but you will only be able to use the bonus from one to buy a house.”