First-time buyers have a “last chance” to get £1,000 free from the Government - but time is running out.
Savers can deposit up to £4,000 every tax year in a Lifetime ISA and they will get a 25% return for free from the Government. This means you could get £1,000 extra if you max out the £4,000 allowance.
If you’re in a couple, you can both open your own Lifetime ISA - potentially netting you £2,000 each tax year to put toward your first time. But time is running out to take advantage, as you’ll need to top up your Lifetime ISA by midnight on April 5. This is because the new tax year starts on April 6.
Sarah Coles, head of personal finance at Hargreaves Lansdown, told The Telegraph : “This is your last chance to get a free £1,000 from the Government in the current tax year. You’ll get your top up at the end of the month you made the contribution – so you’ll have it by the end of April. If you want to super-charge your savings, you can then top up again with another £4,000 on April 6, and earn another £1,000 freebie from the Government. It’s not a bad return for a few minutes’ work.”
You can open a Lifetime ISA if you're aged between 18 and 39, but you can keep saving into your account until you turn 50. However, the money saved in your Lifetime ISA can only be used toward your first home or retirement. If you try to access your money for any other reason, you'll face a a 25% withdrawal penalty which not only wipes out the bonus, but also part of your original savings.
If you're buying a home with your Lifetime ISA, it cannot be worth more than £450,000. The top-paying Lifetime ISA account right now is from Moneybox and this pays 4.4%