OneFamily Lifetime ISA

A Lifetime ISA is a government scheme designed to help you save for two things: buying your first home and retirement¹. OneFamily's version is a stocks and shares Lifetime ISA, so the money you pay in is invested rather than held as cash. You can pay in up to £4,000 a year, the government adds a bonus on top, and you can keep paying in until you are 50².

The trade-off is the withdrawal charge. If you take money out or transfer the Lifetime ISA to another type of ISA before you are 60, and it is not for a qualifying first home purchase, you pay a 25% charge on the total amount in the ISA, including the government bonus³. That means an early withdrawal can leave you with less than you put in.

This page covers what the OneFamily Lifetime ISA is, who can open one, how the charges work, how your money is protected and what to do if something goes wrong. It does not give rates or current charges: OneFamily's own site has today's figures.

What it is and who it is for

A Lifetime ISA is a type of ISA that has existed since April 2017, when it was launched to help people save for a first home or retirement⁵. Legally, it is a plan of a description set out in Treasury regulations, and it is made up of a single Lifetime ISA component only⁶. In practice, that means it is a distinct product rather than a wrapper you can mix with other ISA types in the same account.

OneFamily is a savings and investments provider that runs a Lifetime ISA alongside other ISA products. The account is designed for two groups: people saving towards a first home, and people putting money aside for later life¹. If you are buying with someone else who also has a Lifetime ISA, you can each use your own savings and each benefit from your own government bonus, provided you both meet the first-time buyer conditions³.

The scheme is not for everyone. It tends to suit people who are confident they will use the money for a first home or will leave it until retirement, because the withdrawal charge is designed to claw back the bonus and more if you take the money out early. If you might need the money for something else, a different type of ISA or a savings account may fit better. Our guide to Lifetime ISAs explained sets out how the product compares with other ISA types.

How it works

You pay money in, the government adds a bonus, and the money is invested. The Lifetime ISA subscription limit is £4,000 per year, which is separate from the limits that apply to other ISA types and sits inside your overall ISA allowance².

There is a strict rule on how many you can hold. You can open and pay into one Lifetime ISA per tax year, and you are free to have multiple accounts with different providers over time⁵. The same rule appears in the legislation: a Lifetime ISA qualifying individual may only make a qualifying addition to a single Lifetime ISA in a particular year⁸. You can only pay in until you are 50⁴.

When you use the money to buy a first home, the purchase has to meet the scheme conditions. It must be a first-time residential purchase, and it will not count as a qualifying withdrawal if the purchase is funded by a loan from a person connected to you⁹. You also need to be buying with a mortgage³.

If you are buying with someone else, each first-time buyer can use a Lifetime ISA and each benefit from their own government bonus¹⁰. Accounts are limited to one per person rather than one per home, so two first-time buyers can both receive a bonus¹¹.

How the fees and charges work

There are two separate costs to understand: what the provider charges to run the account, and the government's withdrawal charge if you take money out early. They are not the same thing, and mixing them up is a common source of confusion.

The withdrawal charge is set by the scheme, not the provider. You pay 25% if you withdraw money or transfer the Lifetime ISA to another type of ISA before you are 60³. If you withdraw the entire pot, the 25% charge applies to the total amount in your ISA, including the government bonus³. The government's own worked example makes the effect clear: withdrawing £160 means you pay a 25% withdrawal charge of £40 and receive £120 in cash to meet the bill³. Because the charge is taken from the whole pot rather than just the bonus, an early withdrawal can leave you with less than you originally paid in.

Provider charges are different. The rules define a lifetime ISA charge as any fee or charge made to a retail client in connection with the opening or operation of a lifetime ISA, whether levied by the firm or any other person¹². The scheme rules exclude certain things from the charges that have to be disclosed, including any fee or charge payable for a personal recommendation or ready-made suggestion, and charges relating to the qualifying investments held in the lifetime ISA¹³.

In practice, a stocks and shares Lifetime ISA usually carries an annual account charge worked out as a percentage of the money you hold, and the investments inside it carry their own fund costs. Other providers in the market illustrate the shape of these charges: Hargreaves Lansdown applies an annual account charge to its Lifetime ISA, capped at a monthly maximum, and applies tiered account charges to each account separately rather than across all accounts combined¹⁵. J.P. Morgan Personal Investing says its Lifetime ISA is free to join, with the only fee being for experts to manage your money, plus the cost and market spread of the funds¹⁶. These are examples of how charges are structured, not figures for the OneFamily product.

OneFamily's own site has the current charges for its Lifetime ISA, including the annual management charge and how the withdrawal charge is applied. The annual charge reduces your returns over time and the withdrawal charge only bites if you take money out early, so the two are worth checking separately before opening an account.

It is designed to recover the government bonus and applies to the whole pot, so withdrawing early can cost you more than the bonus you received.

Who can apply and how to apply

To open a Lifetime ISA you must be 18 or over and under 40⁴. The rules set the maximum age to open at under 40, except where certain transfer or defaulted payment rules apply⁸. You can open one from your 18th birthday up to and including your 40th birthday¹⁰. You must be a UK resident, and you can only pay into one Lifetime ISA in each tax year⁵.

If you are buying with someone else, you can both use your savings and government bonus, but you must both be first-time buyers and meet all the conditions for buying your first home³. Some providers add their own conditions on top of the scheme rules. Bath Building Society, for example, says its Lifetime ISA can only be opened by you, cannot be a joint account, and is not for previous home owners or homes over £450,000¹⁷. OneFamily's own terms may include similar conditions, so check them before applying.

To apply, you go through the provider's own process. OneFamily is the ISA manager for its Online ISA, and the same application route applies to its ISA products¹⁸. You will need to confirm you are eligible, choose how the money is invested, and set up payments. If you already hold a Lifetime ISA elsewhere and want to move it, you transfer it rather than withdraw it, because a withdrawal would trigger the 25% charge³. Our guide to transferring a Lifetime ISA to another provider explains how transfers work.

How your money is protected

Money held in a Lifetime ISA is covered by the Financial Services Compensation Scheme, which protects eligible deposits and investments up to £85,000 per person, per firm. The exact limit depends on whether the money is held as cash or invested. Providers across the market confirm this cover: Moneybox says its Stocks and Shares ISA is protected by the Financial Services Compensation Scheme up to £85,000¹⁹, and its Cash ISA is protected by the scheme²⁰. Ford Money says its Fixed Cash ISA is protected under the scheme²¹, and Bath Building Society says its Lifetime ISA is protected by the Financial Services Compensation Scheme¹⁷.

Where money is held through a provider that deposits it with third-party banks, the protection applies per bank and is shared with any money you already hold with that bank²². NatWest and Royal Bank say money held in their Invest ISA cash accounts is treated as a deposit and covered by the same protection as savings and current accounts²³.

OneFamily itself is authorised and regulated by the Financial Conduct Authority, and Family Assurance Friendly Society Limited appears on the FCA Register with reference number 110067²⁵. It also appears on the Bank of England's list of UK insurers authorised to carry out contracts of insurance²⁷. That matters because it tells you the firm is regulated and that you have access to the Financial Ombudsman Service if something goes wrong. Our guide to how your ISA is protected explains the limits in more detail.

Problems, complaints and getting help

If something goes wrong with a Lifetime ISA, the first step is to complain to the provider. That reflects OneFamily's role in administering certain Child Trust Funds, and it shows how the firm handles complaints for accounts it runs.

If you are not satisfied with the provider's response, you can take the complaint to the Financial Ombudsman Service. The ombudsman publishes quarterly complaints data, and it records complaints about Lifetime ISAs as a category. In the first quarter of 2026/27, it recorded 34 complaints about investment-only Lifetime ISAs²⁸. Cash ISAs, including cash Lifetime ISAs and Help to Buy ISAs, saw 352 new complaints in the third quarter of 2025/26²⁹, and 42% of cash ISA complaints were upheld in the fourth quarter of 2024/25³⁰. Those figures give a sense of how often complaints about these products reach the ombudsman.

If you are struggling with debt, free and impartial help is available. Contact's freephone helpline can provide details of national and local debt advice services, and may put families in touch with a specialist debt counselling service for families with disabled children³¹. MoneyHelper also offers free guidance on savings and debt.

Withdrawing £160 means you pay £40 and receive £120³. Check whether the money is needed for a qualifying first home purchase before you withdraw.

What is changing

The government has consulted on a First Time Buyer ISA, and its stated intention is that once available, this new product will be offered in place of the Lifetime ISA³². That means the Lifetime ISA's long-term future is not settled, and anyone opening one now should be aware that the rules could change. The consultation sets out the proposal, but the timing and final shape of any replacement are not fixed.

For now, the Lifetime ISA continues to operate under the existing rules, and OneFamily's Lifetime ISA is available on its current terms. If you already hold one, the change would affect new products rather than your existing account, but the details will depend on what is finally decided. Our guide to the Lifetime ISA withdrawal charge explains the charge in more detail, and our guide to buying your first home with a Lifetime ISA covers the purchase rules.