Lifetime ISA
Lifetime ISA: the bonus, the ages and the size of the pot
Enter your age, what you plan to put in each year and how long before you use the money. The tool adds the government bonus on each payment, stops it at 50 and grows the pot at the rate you choose.
Lifetime ISA: bonus and pot
Pot when you use it
£27,751
| Your payments | £20,000 |
| Government bonus | £5,000 |
| Growth | £2,751 |
A Lifetime ISA is an ISA for people aged 18 to 39 that can hold cash, stocks and shares or both. You can pay in up to £4,000 in each tax year until the day before your 50th birthday, and the government adds a bonus of 25 % on those payments, so at most £1,000 a year. The £4,000 counts inside the overall £20,000 ISA allowance, which is the same in 2026/27 and 2027/28. The money can come out without a charge for a first home costing £450,000 or less, bought at least 12 months after the first payment, from age 60, or in case of terminal illness. Any other withdrawal loses 25 % of the amount taken. Someone of 27 paying the full £4,000 for five years puts in £20,000, receives £5,000 of bonus and, at 3.5 % growth a year, holds about £27,751.
Sums checked by Radif Partners · Editorial policy · How the sums are done
How the bonus builds up
The bonus is a quarter of what you pay in, not a quarter of the pot, and it stops growing once you have paid £4,000 in a tax year (GOV.UK, Lifetime ISA). Paying more than £4,000 is not possible, so the most any saver receives is £1,000 a year. The bonus then sits in the account and earns interest or investment growth along with your own money. The table follows a saver aged 27 who pays the full amount each year, with growth set at 3.5 % as an assumption.
| Time | Own payments | Bonus | Growth | Pot |
|---|---|---|---|---|
| 1 year | £4,000 | £1,000 | £175 | £5,175 |
| 3 years | £12,000 | £3,000 | £1,075 | £16,075 |
| 5 years | £20,000 | £5,000 | £2,751 | £27,751 |
| 8 years | £32,000 | £8,000 | £6,842 | £46,842 |
| 10 years | £40,000 | £10,000 | £10,710 | £60,710 |
After ten years the bonus alone is worth £10,000 before any growth on it. Growth is never guaranteed: in a cash Lifetime ISA it depends on the rate offered, and in a stocks and shares one it can be negative.
The age you start decides the ceiling
Because payments end at 50, the total bonus a person can ever receive depends on when the account is opened. Opening at 18 leaves 32 years of payments; opening at 39 leaves 11.
| Age at opening | Years of payments | Most you can pay in | Most bonus |
|---|---|---|---|
| 18 | 32 | £128,000 | £32,000 |
| 25 | 25 | £100,000 | £25,000 |
| 32 | 18 | £72,000 | £18,000 |
| 39 | 11 | £44,000 | £11,000 |
Who can open one
Besides the age condition, you must be resident in the UK to open a Lifetime ISA and to keep paying in, unless you are a member of the armed forces or a Crown servant, or the spouse or civil partner of one, posted abroad. The account can hold cash, stocks and shares, or a combination of both, and the £4,000 limit covers them together.
Two uses, one account
The account serves two purposes that suit different people. For a first home, the money goes straight to your conveyancer or solicitor, the home must cost no more than £450,000, and a mortgage is needed (GOV.UK, withdrawing money from your Lifetime ISA). The page on the house price limit covers those conditions in detail. Kept until 60, the pot can be taken out in full with no charge and no income tax, which the retirement page sets beside a pension.
Leaving early for any other reason costs 25 % of the amount withdrawn, bonus included. That takes back more than the bonus: the withdrawal charge page shows why you end up below what you paid in.
How many people use it
HMRC counted 99,750 withdrawals to buy a home in 2025/26, with an average of £15,407 each (HMRC annual savings statistics, September 2026). That average is close to four years of full payments plus the bonus, which matches how most buyers use the account: a few years of saving, then one withdrawal at completion.
A First Time Buyer ISA was put to consultation in 2026 as a possible successor for new savers (GOV.UK, First Time Buyer ISA consultation). Its price cap and start date are not set, and existing Lifetime ISAs are not closed by it.