HM Treasury published a consultation on 23 June 2026 on the implementation of a new, simpler ISA product to support first time buyers to buy a home1. The government said the new product, once available, "will be offered in place of the Lifetime ISA"1.
The consultation ran from 10am on 22 June 2026 to 11:59pm on 18 August 2026, a closing date updated on 29 June 20261. The consultation document runs to 22 pages1. The government said it is "committed to making the aspiration of home ownership a reality for as many households as possible"1.
"The government is today launching a consultation on the implementation of a new, simpler ISA product to support first time buyers to buy a home."
The Building Societies Association (BSA) responded the same day, saying the changes will affect savers and "the choices available to them from April 2027"2. Andrew Gall, Head of Savings at the BSA, said building societies need certainty on the final rules so they can update systems and communicate with members ahead of implementation2.
"Building societies are particularly interested in the proposed First-time buyer ISA and we look forward to working with Government to develop a simple product that helps more people achieve homeownership."
The BSA also welcomed proposals that would allow savers to access their money without penalty if their circumstances change, while ensuring first time buyers can release money in good time to support a purchase2. It said it was pleased the government had taken steps to prevent Stocks and Shares ISAs being used to circumvent the reduced Cash ISA limit, and that it would look to HMRC to monitor the use of cash-like instruments closely2. The BSA said that in 2025 building societies paid £2.1 billion more in interest to savers than they would have received from the average rates offered by the major banks2.
The consultation page states the government is analysing feedback and that the outcome will be published1. The sources do not set out the rate, allowance, bonus or eligibility rules of the proposed First Time Buyer ISA, and no start date for the product has been reported beyond the April 2027 reference in the BSA response1.
Why it matters for households
The proposal concerns people saving towards a first home, and the government has said the new product would be offered in place of the Lifetime ISA1. The BSA's response indicates the wider ISA changes are expected to affect savers' choices from April 20272. The consultation document does not, in the material published, set out how existing Lifetime ISA balances, bonuses or withdrawals would be treated under a replacement product, and that has not been reported1. Anyone holding a Lifetime ISA, or considering one, is affected only once final rules are confirmed; the BSA said building societies need that certainty before they can update systems and write to members2.
What happens next
The consultation closed at 11:59pm on 18 August 20261. HM Treasury says it is analysing feedback and that the outcome will be available on the consultation page1. The BSA said it looks forward to working with government to develop the product2.
MoneyHelperFree, impartial money and pensions guidance, set up by government
FSCSProtects your money if a bank, insurer or investment firm fails
Financial Ombudsman ServiceFree, independent help when a complaint about a firm is not put right
GOV.UKOfficial information on tax, benefits and government services
Citizens AdviceFree advice on money, consumer and legal problems in England and Wales