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We've brought together some of the most frequently asked questions about the Skipton Online Cash Lifetime ISA to help you quickly find the answer you need.
The 25% government withdrawal charge is applied to the amount you withdraw. As well as recovering the 25% government bonus, you'll also lose some of your own savings and will receive back less than you invested. This is demonstrated in the example below.
You can only have one Lifetime ISA in each tax year, and you can pay in a maximum of £4,000 each tax year up to and including the day before your 50th birthday. During the same tax year you can also have one Cash ISA, one Stocks & Shares ISA and an Innovative Finance (peer-to-peer) ISA. The combined total of your ISA savings must not exceed the annual ISA allowance (£20,000 in 2018/2019.)
For example, if you save the maximum of £4,000 into a Lifetime ISA, you would still have £16,000 left of your ISA allowance.
You can cancel your Lifetime ISA within 30 days of opening it without incurring a government withdrawal charge. If you opened a Cash Lifetime ISA you will get back the full amount you have paid in.
To cancel your Skipton Online Cash Lifetime ISA within the first 30 days of opening the account, log into Skipton Online and send us a secure message confirming you’d like to close your Lifetime ISA and include the bank details of where you’d like the withdrawn funds to be sent. We will then call you within 48 hours to confirm this. However, due to our online security measures, we can’t return your money until after 14 days after opening your account.
Withdrawing money from your Lifetime ISA within the first 12 months of your first payment into the account will normally incure a 25% government withdrawal charge. After that, withdrawals for any reason other than to help buy your first home or after you’ve reached the age of 60 will also be subject to the government withdrawal charge. This means you would get back less than you paid in.
See the FAQ - If I withdraw from my lifetime ISA and pay the 25% charge, will this apply to the amount I'm withdrawing or my full balance?
The 25% government withdrawal charge doesn’t apply if you are terminally ill or upon death.
Withdrawn funds cannot be replaced without affecting your Lifetime ISA allowance.
If you close your Lifetime ISA after you reach age 40 you won’t be able to open a new one so you may wish to leave a small amount in the account so you can continue to save in it in future. You can continue to pay into your Lifetime ISA up to the day before your 50th birthday and based on the current Lifetime ISA rules. Will gain a bonus of £10,000 if you pay in your full allowance each year between the ages of 40 and 49.
No. Some ISAs are flexible, which means you can withdraw and pay back in throughout the tax year without affecting your overall annual ISA allowance. However, Lifetime ISAs are not flexible, so it will not be possible for withdrawals to be made and replaced without affecting your annual Lifetime ISA allowance or your overall ISA allowance, otherwise you will have to pay the 25% government withdrawal charge on the amount withdrawn.
Yes, but you can only pay into one Lifetime ISA in each tax year and the maximum amount you can pay in each year is your £4,000 Lifetime ISA allowance. For each Lifetime ISA you open, you will need to wait 12 months before being able to instruct your conveyancer when buying your first home.
HMRC will calculate bonus payments for your Lifetime ISA account on a month-by-month basis. Your bonus is calculated on any payments you make into your account from the 6th of the month to the 5th of the following month. Your bonus will be paid into your account within 14 days of the 20th of month two.
The day we receive payment from HMRC, we pay it directly into your account, so you don’t lose any interest.
Important – In order to receive the 25% government bonus you must ensure your details held at both Skipton and HMRC are correct. This includes both your first name and surname, date of birth and National Insurance number (you must not hold a temporary National insurance number to qualify for a Lifetime ISA).
All ISA transfers between ISA providers into Lifetime ISAs are sent by cheque in the post, therefore it can take up to 30 days to complete.
Where we hold your mobile number, we’ll notify you by text once your transfer is complete. If we don’t hold your mobile number you will receive a confirmation email once your transfer has completed.
Yes, any Help to Buy ISA contributions transferred to a Lifetime ISA will get the 25% bonus (but will count towards your Lifetime ISA allowance).
Remember, if you transfer funds from other types of ISA into your Lifetime ISA, the start date of your account is the day you opened your Lifetime ISA, not the date you opened your previous ISA.
If you're withdrawing Lifetime ISA funds to buy your first home, you can only access the money without incurring the 25% government withdrawal charge if your first payment into your Lifetime ISA was at least 12 months before.
Yes you can pay into both, however you can only use the bonus from either a Lifetime ISA or a Help to Buy ISA – and not from both – to buy your first home. You can use your Lifetime ISA to buy your first home 12 months after opening it.
The table below summarises how you can transfer funds into a Lifetime ISA:
Please note: if you've transferred from one Lifetime ISA to another, the 12 month period before you can make a charge free withdrawal for your first house purchase starts from the date you first paid into your original Lifetime ISA.
If you transfer out of your Lifetime ISA into a different type of ISA (Cash ISA, Stocks & Shares ISA or an Innovative Finance ISA) the transfer will be subject to the 25% government withdrawal charge. This means you’ll get back less than you paid in.
You can transfer your Lifetime ISA into another Lifetime ISA without incurring the government withdrawal charge.
Where we hold your mobile number, we’ll notify you by text once we receive your ISA Transfer Authority Form and we’ll keep you updated with the progress of your transfer until this is complete. If we don’t hold your mobile number you will receive an email once your transfer has completed.
We’ve pulled together what you need to know about using your Lifetime ISA to buy your first home.
If you're using your Lifetime ISA for your first home, the money can only be used for your deposit and it must be purchased with a mortgage, on a house valued at £450,000 or less. If you withdraw money from your Lifetime ISA less than 12 months after your first payment into the account, you will have to pay the 25% government withdrawal charge on the amount withdrawn. This would mean you would get back less than you paid in.
You can use your Lifetime ISA to buy your first home 12 months after your first payment into the account without paying the government withdrawal charge. If you’ve transferred to us from a Lifetime ISA with another provider the 12 months starts from the date you paid into the original Lifetime ISA.
If you withdraw before then, even if it is to buy your first home, the 25% government withdrawal charge will apply.
If you’re using the Shared Ownership scheme to buy your first home, your Lifetime ISA can be used towards the deposit when you buy your initial share, but it can’t be used without paying the 25% government withdrawal charge to buy any further shares in future.
If both you and the person you are buying your home with are first time buyers, you can both use your Lifetime ISA to put towards the purchase of your home without paying a government withdrawal charge.
If you are a first time buyer, but the person you are buying your home with has owned a property before then they will not be able to use their Lifetime ISA (if they’ve opened a Lifetime ISA too) towards the purchase of your home without paying a government withdrawal charge. However you, as a first time buyer, would still be able to use your own Lifetime ISA towards the price of the home that you are buying together.
In both cases the price of the home you’re buying together must not exceed £450,000 if you wish to use your Lifetime ISA towards it without paying a government withdrawal charge.
The purchase price of your new home must not exceed £450,000 and the property must be purchased in the UK with a mortgage, but not a Buy to Let mortgage. You must occupy the property as your main residence immediately on completion.
Please note – if you or your spouse/partner are a UK Crown employee serving overseas you must intend to reside in the UK and use the property as your main residence in the future.
Conveyancers can download this from our solicitors' page or you can download it for them from this page and take it to them with your completed Investor Declaration.
If your account is closed, your account would be reinstated and the bonus paid in. We’d record a break in membership of the Society on the system if you don’t have any other accounts with us. We’d then contact you to confirm we’ve received the bonus and ask you what you’d like to do with the bonus amount received. If the bonus has been received after the house purchase has completed you would have to pay the 25% government withdrawal charge if you choose to withdraw it before the age of 60 (the only exceptions to this charge are diagnosis of a terminal illness or death).
90 days from your conveyancer receiving the funds from us. If it’s taking longer than 90 days the conveyancer can write to us to request an extension.
The conveyancer must return the funds within 10 working days of the house purchase falling through, and the amount withdrawn will be paid back in to your account. If the first house purchase withdrawal had closed the account, it will be reopened when the funds are returned, but your membership will not be backdated (if this was the only Skipton account you held). If the conveyancer returns less than the amount withdrawn for the first house purchase, or doesn’t return the funds, you will be charged a 25% government withdrawal charge on the shortfall amount.
The conveyancer is able to request withdrawals from the account as many times as you wish up to completion, there is no minimum withdrawal amount. We’d require completed declarations from both you and your conveyancer each time a withdrawal is requested during this process.
We cover the important facts, the things to think about, and bonus information.
We’ve pulled together what you need to know about using your Lifetime ISA to buy your first home.
We’ve pulled together what you need to know about using your Lifetime ISA to fund your retirement.
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Site intended for UK residents only. Skipton Building Society is a member of the Building Societies Association. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority, under registration number 153706, for accepting deposits, advising on and arranging mortgages and providing Restricted financial advice. Principal Office, The Bailey, Skipton, North Yorkshire, BD23 1DN.