Glossary · UK
What is Lifetime ISA (LISA)?
An ISA for first homes or retirement with a 25% government bonus on contributions.
Full Definition
A Lifetime ISA (LISA) lets you save up to £4,000 per tax year between ages 18 and 50, and the government adds a 25% bonus — up to £1,000 a year. The LISA can be used in two ways: to buy your first home (up to £450,000) or as a retirement pot, accessible penalty-free from age 60. Early withdrawals for any other reason incur a 25% penalty, which on the bonus is roughly equivalent to losing 6.25% of your own money. The £4,000 annual LISA contribution counts towards your overall £20,000 ISA allowance.
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Disclaimer: Definitions are for guidance only. For decisions about your tax, savings, property or pension situation, always consult a qualified professional or refer to gov.uk.