LISA vs Help to Buy ISA: How the Two Schemes Differ
Last updated: October 2026 · Sourced from official UK government publications
This is a plain-English guide to definitions. All figures and rules come from gov.uk/lifetime-isa and gov.uk/help-to-buy-isa. This is not financial advice. See the disclaimer below.
The LISA pays the bigger bonus. The Help to Buy ISA is closed to new applicants.
How does the LISA bonus compare with the Help to Buy ISA bonus?
Both give a 25% government bonus. The totals are very different.
- LISA: up to £1,000 bonus a year. Paid monthly into your account, so it counts from day one. No lifetime cap.
- Help to Buy ISA: £3,000 lifetime cap. Paid only at property completion, not at exchange.
Saving for five years? The LISA can pay £5,000 in bonuses. The Help to Buy ISA pays £3,000 at most.
Contribution limits: Help to Buy up to £200 a month, £2,400 a year. LISA up to £4,000 a year.
Can you still open a Help to Buy ISA?
No. It was open from age 16. It closed to new applicants on 30 November 2019. Existing holders can keep paying in until November 2029, and must use the bonus by November 2030.
The LISA is still open. Open one from age 18 to 39. Pay in until age 50. Both schemes need first-time buyer status.
Property price limits differ. The LISA cap is £450,000 nationally. The Help to Buy ISA cap was £250,000 outside London, and £450,000 in London, when it closed.
Both partners can use their own LISA. Both could use separate Help to Buy accounts too.
Can you hold both, and how do withdrawals differ?
Yes, you can hold both. But you can only use one government bonus per property. You cannot stack them on one purchase.
- LISA: 25% charge on the total balance for any withdrawal outside a first home, age 60 or terminal illness. The account must be open 12 months before first-home use.
- Help to Buy ISA: no charge. No minimum holding period. Take your savings out any time. You just lose the bonus.
For a first home, your conveyancer asks the LISA provider for the money. You cannot take cash and buy with it.
Example: you save £4,000 and the bonus adds £1,000. Withdrawing that £5,000 early returns £3,750 after the 25% charge.
You can move a Help to Buy ISA into a LISA once. That gives up the Help to Buy bonus.
Help to Buy is the more flexible account. The LISA is the bigger bonus.
Can you use both bonuses on one purchase?
No. You get one government bonus per property purchase. At completion, you choose which account’s bonus to use.
- Help to Buy bonus: up to £3,000. Paid only at completion, through your solicitor. Not available at exchange.
- LISA bonus: 25%. Paid monthly as you save. Available from exchange onwards.
Can you transfer a Help to Buy ISA into a LISA?
Yes, in one transfer. It cannot be reversed.
- The transfer counts against the £4,000 LISA limit.
- You give up the Help to Buy bonus. You cannot reclaim it.
- No retrospective LISA bonus on the transferred funds. The 25% applies to new contributions only.
- LISA withdrawals face a 25% charge, unless for a first home, from age 60, or terminal illness.
- A Help to Buy ISA has no such charge.
How does the ISA allowance work with both?
Both count toward the £20,000 ISA allowance for the tax year.
- LISA: £4,000 a year, inside the £20,000.
- Help to Buy: up to £200 a month (£2,400 a year).
- Both reduce what’s left for other ISA types that tax year.
Nothing changes for 2026/27. The tax year runs from 6 April 2026 to 5 April 2027.
More detail
Which Government Bonus Gives More Money: LISA or Help to Buy ISA?
The LISA gives significantly more. The Help to Buy ISA has a lifetime bonus cap of £3,000, paid only at property completion. The LISA pays up to £1,000 per year straight into your account, with no lifetime cap. Someone saving for five years can collect £5,000 in LISA bonuses. The Help to Buy ISA pays a maximum of £3,000.
| Lifetime ISA (LISA) | Help to Buy ISA | |
|---|---|---|
| Bonus rate | 25% on contributions | 25% on savings |
| Annual contribution limit | £4,000/year | £2,400/year (£200/month max) |
| Maximum annual bonus | £1,000/year ✓ Higher | No annual bonus limit, paid at completion |
| Lifetime bonus cap | Up to £32,000–£33,000 (ages 18 to 50) | £3,000 maximum (on £12,000 saved) |
| When bonus is paid | Monthly into your account | At property completion via your solicitor |
| Bonus counts toward deposit? | Yes, already in your account | No, paid only at completion, not exchange |
For most first-time buyers, the LISA offers considerably more bonus money over time. The Help to Buy ISA caps out at a £3,000 lifetime bonus. The LISA can deliver £1,000 every year. Someone saving for five years could collect £5,000 in LISA bonuses, compared with £3,000 at most from a Help to Buy ISA. The LISA bonus is already in your account. How and when it lands is explained in when the government pays your LISA bonus.
How Do the Eligibility Rules Differ Between LISA and Help to Buy ISA?
The key difference is that the Help to Buy ISA closed to new applicants in November 2019. You cannot open one now. The LISA is still open to anyone aged 18 to 39. Both need first-time buyer status. The LISA has a national property price limit of £450,000. The Help to Buy ISA’s limit was £250,000 outside London.
| Lifetime ISA (LISA) | Help to Buy ISA | |
|---|---|---|
| Open to new applicants? | Yes ✓ Still open | No, closed 30 Nov 2019 |
| Age to open | 18–39 only | 16+ (when open) |
| Age to contribute | Up to age 50 | Until Nov 2029 (existing accounts only) |
| First-time buyer required? | Yes | Yes |
| Property price limit (England) | £450,000 ✓ Higher | £250,000 (£450,000 in London) (limits at scheme closure, Nov 2019) |
| Can both partners use the scheme? | Yes, both can use separate LISAs | Yes, both could use separate accounts |
| Can you hold both? | Yes, but you can only use one government bonus per property purchase | |
The property price limit is a critical difference for most of England. Outside London, the Help to Buy ISA was capped at £250,000. That limit rules out most properties in many parts of the country today. The LISA’s £450,000 limit covers the vast majority of first-time buyer purchases. The £450,000 figure is unchanged for the 2026/27 tax year. The conditions attached to it are set out in the LISA withdrawal rules.
If you already hold a Help to Buy ISA and are under 40, you can also open a LISA. The sections above on using both bonuses and transferring between them explain how that works in practice. However, you can only use one government bonus when you buy. You cannot stack both on the same purchase. The LISA offers a higher lifetime bonus and a higher property price limit. The Help to Buy ISA offers more flexibility on early withdrawal. Which one suits you depends on your own situation. If you are unsure, consider speaking to an independent financial adviser.
What Are the Withdrawal Rules for Each Scheme?
The LISA has a strict 25% early withdrawal penalty on the full balance. You can get back less than you put in if you withdraw for an ineligible reason. The Help to Buy ISA has no penalty. You can withdraw your savings at any time, but you forfeit the government bonus. So the Help to Buy ISA is more flexible, while the LISA is more powerful for eligible buyers.
| Lifetime ISA (LISA) | Help to Buy ISA | |
|---|---|---|
| How to use for property | Conveyancer requests funds directly from LISA provider | Solicitor applies for bonus via government portal at completion |
| 12-month holding rule | Yes, must hold 12 months before use | No minimum holding period |
| Early withdrawal penalty | 25% on total balance (can lose more than you saved) | None, withdraw savings anytime, just don’t get the bonus |
| Non-property withdrawals | Only penalty-free at age 60+ or terminal illness | Anytime, just lose the bonus entitlement |
| Flexibility ✓ HTB wins here | Low, money is locked in | High, withdraw savings at any time |
The LISA’s withdrawal penalty is its biggest downside. If your plans change, you inherit a property, you buy above the £450,000 limit, or you simply need the money, withdrawing early costs you 25% of the total balance. On a £20,000 LISA pot, that’s a £5,000 penalty. You would be left with £15,000, from £16,000 of your own money.
The Help to Buy ISA has no such penalty. You can withdraw your savings at any time. You just don’t claim the government bonus. This flexibility made it more forgiving. But its lower property limit and smaller bonus made it less powerful for most buyers.
The bottom line: the LISA has the bigger bonus and the higher property cap. The Help to Buy ISA has the easier exit. The LISA also has a 12-month clock. That clock starts when the account is opened, so the opening date matters regardless of how much you pay in. If you hold both, you choose which bonus to claim at completion. The property price against each limit decides whether both are even available.
Both accounts sit inside the same £20,000 annual ISA allowance. So contributions to either reduce what you can put elsewhere. That interaction is covered in does a Lifetime ISA count towards your ISA allowance. The £4,000 LISA cap itself is in the LISA contribution limits guide.
Should you transfer a Help to Buy ISA into a LISA?
The Help to Buy bonus (up to £3,000) is only payable when you buy a property. If you have not claimed it yet and you transfer your balance to a LISA, you give up the Help to Buy bonus entirely. You move to the LISA bonus structure instead. Before you transfer, compare which bonus path is worth more for your situation, using the tables above.
Once the money lands, it follows the LISA rules. These include the 25% withdrawal charge on anything taken out, unless it is for a qualifying first home, from age 60, or on terminal illness. A Help to Buy ISA has no such charge. So the transfer swaps a flexible account for a locked one. Transfers in do not attract a retrospective bonus, and they count toward the £4,000 cap. The LISA contribution limits guide covers this.
Neither account is taxed on growth, and neither has to go on a tax return. Each sits inside its own ISA wrapper, however many ISA types you hold. The how an ISA works guide explains it.
Is a replacement scheme coming?
Possibly, but nothing is law yet. On 22 June 2026, the government published a consultation on a First Time Buyer ISA. It proposes offering this in place of the Lifetime ISA. The consultation closed on 18 August 2026.
As proposed, the FTB ISA would pay its bonus at the point of purchase, not as you save. It would carry no withdrawal charge and no upper age limit. The property caps for the FTB ISA, the Lifetime ISA and the Help to Buy ISA would be brought into line with each other. The bonus rate and contribution limits will be announced at a future fiscal event.
Until any of that happens, nothing changes. The Help to Buy ISA stays closed to new applicants. The Lifetime ISA can still be opened by anyone 18 or over and under 40. Existing LISA holders can carry on saving under the current rules.
Tools and guides
- Kvanta tools: free calculators and explainers in one place.
- Lifetime ISA calculator: see your bonus and projected balance.
- LISA withdrawal rules: when the 25% charge applies.
- Lifetime ISA explained: who can open one, and the age rules.
- LISA and your ISA allowance: how the £4,000 fits inside the £20,000.
- LISA government bonus explained: how the 25% top-up works.
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Official sources
Not financial advice. This guide compares the LISA and Help to Buy ISA based on HMRC rules as of October 2026. It is for information only. It is not personal financial advice. Individual circumstances vary, so consider speaking to an independent financial adviser before making any savings decision. Always check gov.uk/lifetime-isa and gov.uk/help-to-buy-isa for the latest rules.