You are here: Home - Investing - Experienced Investor - News -

Has your Lifetime ISA bonus payment been delayed?

Written by: Emma Lunn
A HMRC error could leave homebuyers aiming to complete a property purchase before the end of the stamp duty holiday out of pocket.

An investigation by (MSE) discovered the technical issue which HMRC says is now fixed.

A Lifetime ISA allows you to save up to £4,000 a year towards your first home or retirement. The government adds a 25% cash bonus of up to £1,000 a year on top.

Bonuses are calculated and paid if, and when, a saver makes a monthly contribution. So, if someone deposited the maximum £4,000 allowance between the start of the new tax year on 6 April and 5 May, they’d be due their £1,000 bonus by the end of May.

But HMRC failed to process both cash and stocks and shares Lifetime ISA (LISA) bonus payments during this period, so this money didn’t arrive in accounts by the end of May as expected. The taxman says the issue has now been fixed and all missing bonuses have now been paid to LISA providers.

HMRC told MSE that although all LISA providers could be impacted by the error, only those with bonuses that were due to be processed by the end of May would have been hit. It believes only a ‘small number’ of savers will have been affected.

Lifetime ISA provider Moneybox said the majority of its cash savers who deposited money between 6 April and 5 May will have been affected.

The stamp duty holiday is due to end on 30 June. The scheme was meant to end in March but was extended by chancellor Rishi Sunak in his Spring budget. The extension was intended to help those with purchases already in progress to complete, but in fact it prompted more people to try to buy before the new deadline.

If your Lifetime ISA bonus payment is missing, you need to contact your LISA provider.

If you’re in the process of completing a house purchase, you should tell your conveyancer how much you wish to withdraw from your LISA – and explain that there may be a delay while you wait for the missing bonus cash to be added.

HMRC says it will pay interest of 2.6% on top of delayed bonuses for the period between when the payment was due to be paid and when it was actually deposited.

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Your right to a refund if travel is affected by train strikes

There have been a wave of train strikes in the past six months, and for anyone travelling today Friday 3 Febru...

Could you save money with a social broadband tariff?

Two-thirds of low-income households are unaware they could be saving on broadband, according to Uswitch.

How to help others and donate to food banks this winter

This winter is expected to be the most challenging yet for the food bank network as soaring costs push more pe...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Five tips for surviving a bear market mauling

The S&P 500 has slipped into bear market territory and for UK investors, the FTSE 250 is also on the edge. Her...

Money Tips of the Week