Who can open a Lifetime ISA?

A Lifetime ISA is open to anyone aged 18 or over but under 40, and the government adds a 25% bonus to what you pay in until your 50th birthday¹. The age you open at and the age you stop paying at are two different rules, and mixing them up is the most common reason people think they have missed out.

You can put in up to £4,000 a year, and that £4,000 sits inside your overall £20,000 ISA allowance rather than on top of it³. You can hold more than one Lifetime ISA, but you can only pay into one of them in any single tax year⁵.

The scheme launched in April 2017, and savers have been able to contribute and receive the bonus from age 18 up to age 50 since then⁷.

Age limits: open between 18 and your 40th birthday

The official rule is that you must be 18 or over but under 40 to open a Lifetime ISA¹. In practice that means the last birthday on which you can open one is your 39th, and several providers put it that way: one building society says you must be aged between 18 and 39 to open a Lifetime ISA, and another describes the range as 18 to 39¹⁰. A bank's guidance says Lifetime ISAs can be opened by those aged 18 to 40, which sits at the boundary¹². The official wording is the one that matters: under 40.

There is no upper age limit on holding the account, only on opening it. A Lifetime ISA opened in line with the rules is still treated as a Lifetime ISA even after the account holder reaches 50 or over, though no further qualifying addition can be made¹³.

The minimum age of 18 is firm. Money held in a Junior ISA can be moved across once the child reaches 18, which is covered in moving Junior ISA money into a Lifetime ISA.

Paying in: up to £4,000 a year until age 50

The annual limit is £4,000 per tax year, and it applies until you turn 50⁶. You can pay in up to the Lifetime ISA allowance each year until you reach the age of 50, and the same £4,000 figure appears across provider documents and official statistics¹⁰.

The £4,000 is a subscription limit, not a balance cap. It resets each tax year, so a saver who pays in the maximum every year from 18 to 50 builds a substantial pot, and the government bonus is calculated on what goes in, not on what the investments later do. One provider notes that using the full £4,000 allowance each year from 18 to 50 means £44,000 of your own money has gone in, unless you have used the rest of your overall ISA allowance in other ISA types¹⁶.

The bonus is the reason the age rules matter so much. Any savings you put into a Lifetime ISA before your 50th birthday receive the standard 25% bonus from the government, and a full £4,000 contribution is topped up with £1,000². The bonus is paid subject to specific circumstances set out in the legislation, so it is not automatic on every payment¹⁷. The Financial Conduct Authority's illustration tables assume the maximum annual subscription at the beginning of each tax year up to age 50 and receipt of the Lifetime ISA government bonus¹⁸.

One Lifetime ISA per tax year

You can open and pay into one Lifetime ISA per tax year⁶. The legislation is stricter still: a Lifetime ISA qualifying individual may only make a qualifying addition to a single Lifetime ISA in a particular year⁵. Paying into two in the same tax year breaks the subscription rules, and the page on when an ISA subscription breaks the rules explains what happens next.

Holding more than one is allowed. Individuals can open and pay into one Lifetime ISA per tax year and are free to have multiple accounts with different providers⁶. Independent guidance puts it the same way: you can have more than one Lifetime ISA, but must only pay into one each tax year¹⁹. So a saver who switches provider keeps the old account open and simply stops paying into it.

The rule has a practical effect for couples. Saving separately in two Lifetime ISAs can double the government bonus a couple can receive, because each person has their own £4,000 limit and their own bonus²⁰. Two people buying together can both use their savings and government bonus, provided both are first-time buyers and meet all the conditions for buying a first home⁸.

How the government bonus fits into eligibility

The bonus is not a separate allowance and it does not depend on a separate application. It is paid on contributions, at 25%, and it is tied to the same age window as paying in: the holder can receive government bonuses on their contributions to their LISA until the age of 50²¹. Savers can make Lifetime ISA contributions and receive a bonus from the age of 18 up to the age of 50⁷.

Because the bonus is a percentage of what you pay in, the £4,000 limit and the bonus are linked. A full £4,000 contribution attracts £1,000, and the savings you put in are topped up by a 25% bonus from the government². The Lifetime ISA is a form of ISA in which a government bonus is paid subject to specific circumstances, so the conditions attached to the account, including the first-home rules and the withdrawal charge, apply to the bonus as well as to your own money¹⁷.

Eligibility for the bonus therefore comes down to three things: you hold a valid Lifetime ISA, you are under 50 when the payment is made, and the payment is within the £4,000 annual limit. The Lifetime ISA government bonus page sets out how much that is worth over time, and Lifetime ISA (LISA) explained covers how the account works day to day.

Does the £4,000 limit count towards my overall ISA allowance?

Yes. The £4,000 Lifetime ISA allowance makes up part of your overall £20,000 ISA allowance³. The same point is made across provider documents: the £4,000 usually counts towards your overall £20,000 ISA annual allowance, and it contributes towards your overall £20,000 ISA allowance for the current tax year⁴. A Lifetime ISA is not an extra allowance bolted on beside the main one.

That matters when you are deciding how to split your money. If you use the full £4,000 in a Lifetime ISA, £16,000 of the £20,000 remains for other ISAs in that tax year. If you use less, the unused part of the £4,000 is not lost, it simply stays available within the overall allowance. The ISA allowance page covers how the £20,000 works across account types, and can I pay into more than one ISA in a year deals with the general rule that you can split your allowance across different ISA types but not across two of the same type in the case of Lifetime ISAs.

The £4,000 figure is consistent across the sources: it is described as the Lifetime ISA subscription limit in official statistics, in provider key features documents, and in building society guidance⁶. The overall allowance it sits inside is £20,000 this tax year³.

Opening one, and what to check first

Opening a Lifetime ISA is a provider process, not a government one. You apply to a bank, building society, investment platform or app, confirm you are eligible, and the provider checks your age and residency. The who can open an ISA page covers the general eligibility rules that apply to all ISAs, including residency.

Before opening, three things are worth checking against your own circumstances:

• Your age on the day you apply. Under 40 is the rule, and a provider will not open the account if you have already had your 40th birthday¹.
• Whether you will want the money before 60. Withdrawals outside the permitted reasons normally attract a charge, covered in the Lifetime ISA withdrawal charge.
• Whether a Lifetime ISA or a pension suits your situation better. The Lifetime ISA or workplace pension for retirement comparison sets the two side by side.

If you already hold a Lifetime ISA with one provider and want to move it, the transferring a Lifetime ISA to another provider page explains how transfers work without using up allowance.

Where the rules stop and who to ask

The age rules are set in legislation and in government guidance, so a provider cannot waive them. If you are 40 or over and have never opened a Lifetime ISA, you cannot open one now, and no provider can change that¹. If you are under 40 and a provider refuses an application, the reason will normally be one of the eligibility conditions rather than the age rule.

If something goes wrong with an application, a transfer or a bonus payment, the first step is the provider's own complaints process. If that does not resolve it, the Financial Ombudsman Service can look at complaints about ISA providers, and the complaining about an ISA provider page sets out how that works. MoneyHelper offers free, impartial guidance on ISAs and on saving for a first home.