Using a Lifetime ISA or Help to Buy ISA to buy your first home

Lifetime ISA at a glance

Can I still use my Lifetime ISA if the home costs more than £450,000?

Yes, from 29 October 2026. Before that date, a home over £450,000 meant a 25% charge, which could leave you with less than you paid in. Now a first-home withdrawal for a home over £450,000 is charged at 20%. Everything else about the first-home route stays the same: you still need a mortgage, the 12-month rule still applies, and HMRC says the money still goes through your conveyancer with both declarations.

What this means in money, with no growth, for a pot built from £16,000 of your own savings:

So with no growth, above the cap you get back what you paid in, but not the bonus. The 20% is taken from the whole amount you take out. If your savings have grown, it is taken from the growth too. If a stocks and shares pot has fallen, you get back less than you paid in: £16,000 paid in plus a £4,000 bonus, fallen to £18,000, means a £3,600 charge and £14,400 to you.

Points buyers miss:

• The change is not backdated. A withdrawal made before 29 October 2026 stays at 25%, and money already taken out cannot be paid back in.
• £450,000 is the whole purchase price, not your share of it, even if you are buying with someone.
• On shared ownership, the cap is tested on the full market value. A 25% share bought for £120,000 counts as a £480,000 home.

What has to be true for the Lifetime ISA bonus to stay in?

Every one of these must be true for a charge-free withdrawal:

Problems buyers often describe online (general accounts, not our clients’ cases or reviews):

1. The provider was asked too late, the money arrived after the agreed date, and completion slipped.
2. The account had not been open 12 months on the day of withdrawal, so the provider refused it days before completion.
3. More was withdrawn than the deposit needed. The extra goes towards the price; it cannot pay fees.

Tell us about the ISA when you instruct us, not when the mortgage offer arrives.

Of first-time buyers with a mortgage, buying at up to £450,000, who answered our quote page’s ISA question, about 1 in 4 said yes: about 20% a Lifetime ISA and about 5% a Help to Buy ISA (website quote requests, 2 Sep–29 Oct 2026, rounded to the nearest 5%).

When should the Lifetime ISA claim start so completion isn’t held up?

Your provider has up to 30 days to pay once it has both declarations. The 90-day clock starts when we receive the money. So there is a window: not too early, not too late. The planner on this page works out both ends of it from your completion date.

With stocks and shares, the provider has to sell first, and the value can change until it does.

Can Lifetime ISA money be used for the deposit at exchange?

HMRC’s rules say the money must be used towards the price and the purchase must complete within 90 days of us receiving it. They don’t say it can only be used on completion day, and firms handle this in different ways.

A Help to Buy ISA is different: the bonus is paid between exchange and completion and can only go into the completion money, so it cannot pay your exchange deposit.

We’re buying together: can we each use an ISA?

Yes. The limit is one government bonus per person, not one per home.

• Two Lifetime ISA holders can both use their savings and bonus on the same purchase. Both must be first-time buyers and meet all the rules.
• Two Help to Buy ISA holders both get their 25% bonus.
• One person can’t use the bonus from both a Lifetime ISA and a Help to Buy ISA on the same home. You can move Help to Buy ISA money into a Lifetime ISA. Moving money the other way costs the 25% charge.
• You can use your Lifetime ISA when buying with someone who has owned a home before. But Stamp Duty first-time buyer relief needs every buyer to be a first-time buyer. See the first-time buyer stamp duty calculator.
• We make a separate claim for each account.

If your shares in the home are unequal, the ISA money doesn’t decide who owns what. Your ownership needs setting up properly.

How is a Help to Buy ISA different when you buy?

Help to Buy ISA tip: keep the closing statement your bank sends. We need it to claim. The limits are on GOV.UK.

What happens to the money if completion slips or the purchase falls through?

• Slipping past 90 days: if the purchase is still going ahead, we ask your provider for a 60-day extension, then a further 30 days if needed. That gives up to 180 days in all. Tell us as soon as a date looks like moving.
• Falling through, or not completing in time: we return the full amount to your provider, so there is no charge on it. Any part not returned is charged.
• After completion: we tell your provider the completion date within 10 business days.

Do the Lifetime ISA rules change for a home in Wales?

The ISA rules are UK-wide, so the £450,000 cap, the 20% charge and the 90 days are the same in Wales. The tax is not. Wales has Land Transaction Tax, with no first-time buyer relief.

Worked from the official bands: England relief 0% to £300,000, 5% from £300,001 to £500,000. Wales main rates 0% to £225,000, 6% to £400,000. Work out a Welsh price with our Land Transaction Tax calculator.

What will the new First Time Buyer ISA mean for my Lifetime ISA?

The government will bring in a First Time Buyer ISA from April 2029, in place of the Lifetime ISA for new savers. A Lifetime ISA opened before then carries on under its current rules. You will be able to use both on the same purchase, but you can’t transfer a Lifetime ISA into the new one. The £450,000 cap stays for both. Help to Buy ISA holders will be able to move their whole balance in between 6 April 2029 and 1 December 2030. Nothing changes for a purchase you make now.

What we charge for a purchase with an ISA, and what is separate

Our fee range for buying a residential property is in the box below. A Lifetime ISA adds a fixed fee, shown as its own line in your written, itemised quote before you instruct us. See our fees.

Stamp Duty or Land Transaction Tax sits in its own box, never added to our fees.

We are not tax or financial advisers: for whether to save into an ISA, speak to a financial adviser.

What happens next

• Conveyancing for first-time buyers
• First-time buyer stamp duty calculator
• First Homes and other first-time buyer schemes
• More guides, explained