Saving for a first home
A Lifetime ISA can add a government bonus to your savings, but the withdrawal rules matter as much as the bonus. Before you make an offer, check the date of your first payment, the price of the whole property and whether your conveyancer can use the funds for this purchase.
This guide covers the account rules and the mortgage questions to ask. It is general information, not personal savings, investment or mortgage advice.
What is a Lifetime ISA?
A Lifetime Individual Savings Account (LISA) is a UK account for saving towards a first home or later life. You can pay in up to £4,000 each tax year until age 50. The government adds 25% to eligible contributions, up to £1,000 in a tax year. A LISA can hold cash, investments, or a combination; returns and risks depend on the product you choose. See the current GOV.UK overview.
You generally need to be aged 18 to 39 to open one and meet the UK-residence rules (with specified Crown service exceptions). Make the first payment before your 40th birthday. Opening an empty account alone does not start the first-home 12-month clock. If you need to choose between cash and investments, compare provider terms and seek suitable savings or investment advice; Count Ready’s role here is to help with the mortgage side of a purchase.
Can you use your LISA for this home?
Check your buyer status
You must be a first-time buyer for a charge-free first-home withdrawal. Previous ownership of a home or share, including abroad, can affect this. Ask your conveyancer if your history is unusual.
Check the whole price
The purchase price must be £450,000 or less under the current rules. For shared ownership, assess the value of the whole property, not just the first share. Our shared ownership mortgage guide covers the separate mortgage and housing costs.
Check time and purpose
At least 12 months must pass between your first payment into the LISA and the qualifying withdrawal. You must buy with a mortgage and intend to live in the property as your main home. A buy-to-let purchase does not qualify.
The ISA provider must pay the withdrawn funds directly to your eligible conveyancer for the purchase price. Do not withdraw the money to your own bank account for a deposit without checking the charge consequences. The rules apply across the UK, while property taxes, buying steps and homeownership schemes differ between England, Scotland, Wales and Northern Ireland. See GOV.UK’s withdrawal conditions and our first-time buyer property-tax guide.
What if you need the money for something else?
A withdrawal outside the permitted first-home, age-60 or terminal-illness conditions usually carries a 25% charge on the amount withdrawn. That is more than simply giving back the bonus. For example, £4,000 of contributions plus a £1,000 bonus makes £5,000, ignoring any interest or investment change. A 25% charge on £5,000 is £1,250, leaving £3,750: £250 less than the original contribution.
If you keep the account for later life, charge-free withdrawals are generally available from age 60. This article does not compare a LISA with pension products or recommend an investment choice. Check the latest withdrawal rules with GOV.UK.
Buying with someone else
If both buyers meet the first-time buyer and LISA conditions, both may use their own accounts towards the same purchase. If only one buyer qualifies—for example, the other has owned a home—the eligible buyer may still be able to use their own LISA. The other buyer cannot use their LISA for a charge-free first-home withdrawal. Each eligible LISA holder needs their own declaration; your conveyancer can check how the funds fit the transaction. This distinction is set out in HMRC’s first-home withdrawal guidance.
A LISA does not make the mortgage affordable by itself. When you buy jointly, a lender assesses the applicants’ income, commitments, deposit source and property. Read our joint mortgage guide or first-time buyer mortgage service for the borrowing side.
From finding a home to completing the purchase
- Before an offer: ask your LISA provider to confirm the first-payment date, balance, withdrawal documents and normal processing time. Check the full property price and tell your mortgage adviser that the deposit includes LISA funds.
- When instructing a conveyancer: tell them early that you will use a LISA. They will arrange the investor and conveyancer declarations and request funds from your provider. Your provider pays them directly, not you.
- Before completion: keep your adviser and conveyancer updated if the property, price or completion date changes. The withdrawal is normally linked to a purchase expected to complete within 90 days; the conveyancer may seek an extension if needed.
- If the purchase falls through: contact your conveyancer and LISA provider promptly. The conveyancer must return unused withdrawn funds to the LISA manager under the relevant rules; a shortfall or failure to return them can trigger a charge.
There is no universal promise that a provider will release money within a fixed number of days. Ask your own provider and conveyancer for the lead time for your purchase. Read the HMRC process and failed-purchase rules.
What if you also have a Help to Buy ISA?
You can hold both accounts, but you cannot use both government bonuses for the same first-home purchase. A Help to Buy ISA has different property-price and bonus rules. Check both providers’ terms and ask your conveyancer which bonus route suits the purchase; do not assume that transferring funds preserves every advantage. A Help to Buy ISA is also distinct from the closed English Help to Buy equity-loan scheme. Our UK homeownership schemes guide covers those separate routes.
Lifetime ISA questions before you buy
Does the 12-month Lifetime ISA rule start when I open the account?
No. For a charge-free first-home withdrawal, at least 12 months must have passed since your first payment into the Lifetime ISA. Check that payment date with your provider before relying on the funds for a purchase.
Can I use a Lifetime ISA if the person buying with me has owned a home?
You may be able to use your own Lifetime ISA if you personally meet the first-time buyer and purchase conditions. A co-buyer who has previously owned a home cannot use their own Lifetime ISA for a charge-free first-home withdrawal. Tell your conveyancer about both buyers’ circumstances.
Can I use a Lifetime ISA for shared ownership?
Potentially, if the Lifetime ISA and shared ownership conditions are both met. The £450,000 Lifetime ISA limit is assessed against the value of the whole property, not just the share you initially buy. Ask your conveyancer and scheme provider to check the specific transaction.
What happens if the home costs more than £450,000?
The current Lifetime ISA first-home withdrawal rules do not allow a charge-free withdrawal for a property above £450,000. You could leave the money in the account for a later qualifying use or withdraw it subject to the usual 25% charge. Check the latest rules and your options with your provider before committing to a purchase.
Can I use a Lifetime ISA and a Help to Buy ISA together?
You can hold both, but you cannot claim both government bonuses for the same first-home purchase. Compare the rules with your ISA providers and conveyancer before choosing which account to use.
Check the mortgage plan alongside your LISA
Count Ready can discuss the mortgage amount, deposit evidence, affordability and lender process for your proposed home. Tell us the property nation and price, your available deposit, whether any of it is in a LISA, and when you hope to buy. Your ISA provider and conveyancer remain responsible for the account withdrawal and legal purchase steps.
The initial mortgage consultation is free. Fees for further work vary by case; a separate processing fee may apply and is not always charged. We will explain any applicable fee before chargeable work starts. Read our Terms of Business and adviser information.
Use the form for an initial question, not bank statements, identity documents or account numbers. An adviser can explain secure document collection later.
Reviewed 4 October 2026. LISA, ISA and property-purchase rules can change. Recheck official guidance and your provider’s terms before relying on a bonus or making an offer. This is general information, not a personal recommendation.
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