Compare the Help to Buy ISA and Lifetime ISA for first-time buyers. See projected LISA totals including government bonus, eligibility checks and how the two schemes compare.
Last updated: April 2026
Your situation
LISA requires age 18–39 to open. Help to Buy ISA is closed to new applicants.
LISA: max property price £450,000. HTB ISA: max £250,000 (£450,000 in London).
HTB ISA closed Nov 2019. Enter existing balance if you hold one. Max bonus: £3,000.
LISA scenario
Max £4,000/yr = £333/month. Government adds 25% bonus monthly.
The Help to Buy ISA closed to new applicants in November 2019, but existing holders can continue saving and use their bonus until November 2030. If you opened one before the cutoff, you still have a choice to make when purchasing. New savers from November 2019 onwards have only the Lifetime ISA (LISA) as the government-bonus first home purchase option.
LISA advantages over Help to Buy ISA
The LISA is more generous in almost every respect. You can contribute up to £4,000 per year versus £2,400 in the HTB ISA (£200/month). The maximum government bonus on a LISA is £1,000 per year versus a lifetime maximum of £3,000 on a HTB ISA. The LISA bonus is paid monthly and immediately invested, so it compounds. The LISA can also be used for retirement from age 60, making it a dual-purpose product. The main restriction is the £450,000 property price cap, which rules out LISA for higher-value purchases in London.
The 25% withdrawal penalty
Withdrawing from a LISA for any reason other than buying a first home or retirement after 60 (or terminal illness) triggers a 25% withdrawal charge on the full amount - which effectively returns the bonus and deducts an additional 6.25% of your own contributions. This means a LISA should only be opened with a clear first home or retirement purpose. If your plans change and you need the money urgently, the penalty makes LISAs a poor emergency fund.
Frequently asked questions
Yes, if you opened a HTB ISA before November 2019, you can hold both. However, you can only use the government bonus from one of them for a single property purchase - not both. Most financial advisers suggest prioritising the LISA bonus for the purchase (as it is typically larger) and closing the HTB ISA or using it as a standard savings account. You cannot contribute to a HTB ISA and a Cash ISA in the same tax year, but you can contribute to a LISA and a Cash ISA together.
If you use a LISA to buy a property over £450,000, you cannot use the LISA for the purchase at all - not even for a partial contribution. You would need to withdraw the money, paying the 25% penalty, or leave the LISA untouched and use it at age 60 as a retirement fund. The HTB ISA had a lower price cap (£250,000 outside London, £450,000 in London), making it unsuitable for many first-time buyers even before it closed. For buyers targeting properties above £450,000, neither scheme is available and a standard Stocks and Shares ISA is the appropriate savings vehicle.
For short time horizons (under 3 years), a Cash LISA is more appropriate - guaranteed rate, no volatility risk, and full capital protection. For 5+ years, a Stocks and Shares LISA has historically outperformed cash significantly despite short-term volatility. The 25% government bonus adds to both, making LISAs more attractive than equivalent non-bonus savings products regardless of type. If you are saving over multiple years with a clear first home timeline of 5–10 years, a Stocks and Shares LISA typically makes the most sense.