Has your Lifetime ISA bonus payment been delayed?
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 MoneySavingExpert.com (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.