HMRC ISA Tax Changes Could Open New First-Time Buyer ISA to Over-40s
The proposed account would remove withdrawal penalties and let Help to Buy ISA holders transfer savings, while existing Lifetime ISA holders cannot.
- The Government unveiled a consultation on plans for a First-Time Buyer ISA , a new savings product designed to replace the Lifetime ISA for those purchasing their first home.
- Last November, the Labour Party announced plans to launch a "simpler" ISA, stating the current LISA wasn't "working for everyone" and needed replacement to better support first-time buyers.
- Unlike the current system, the proposed FTB ISA removes the 25 per cent withdrawal penalty for non-housing purposes and allows access for those over 40, with the government bonus paid upon property purchase completion.
- Rachel Griffin, tax and financial planning expert at Quilter, argues the £450,000 property price cap fails to reflect current house prices, while savers may receive less money without annual bonus interest payments.
- Separately, HMRC published draft legislation for ISA reforms taking effect from April 2027, including a 22 per cent charge on interest earned from cash held inside non-cash ISAs, including Stocks and Shares ISAs.
15 Articles
15 Articles
HMRC ISA Tax Changes Could Open New First-Time Buyer ISA to Over-40s
People aged over 40 could gain access to a government-backed first-time buyer savings scheme under Treasury plans to replace the Lifetime ISA with a new First-Time Buyer ISA. The proposed account would be open to all adults aged 18 and over, removing one of the main restrictions of the current system. The proposed savings account would continue offering a 25 per cent government bonus towards the purchase of a first home. However, unlike the Life…
How new First Time Buy ISA will work - and what it means for Lifetime ISA holders
The Government is set to scrap the Lifetime ISA (LISA) and introduce a new savings product designed specifically for first-time buyers. Last November – at its Budget – the Labour Party said that the LISA wasn’t “working for everyone” and announced plans to launch a “simpler” ISA aimed at those buying a home for the first time. It has now unveiled a consultation on plans for a First-Time Buyer ISA (FTB ISA), which is set to be the replacement. Th…
HMT publishes consultation on the proposed First Time Buyer ISA
On 23 June 2026, HM Treasury (HMT) published a consultation in relation to the proposed First Time Buyer Individual Savings Account (FTB ISA).BackgroundHMT has confirmed that it will be withdrawing the Lifetime ISA (LISA) on the basis that it considers there is evidence to suggest that this product is not working well for many consumers, due to issues with the complexity of the product and withdrawal changes. As a result, this consultation seeks…
Government’s new property ISA plans divide industry experts
Industry experts are divided on the government’s plans to replace the Lifetime ISA (LISA) with a First Time Buyer ISA (FTB ISA). The government launched a consultation on the ISA reforms yesterday (23 June) that described the LISA as “not working well for many’ with the number of unauthorised withdrawals increasing annually and more LISA holders losing some of their original savings than used it to purchase a house. The FTB ISA is designed to he…
Government unveils First Time Buyer Isa details
The government has set out plans for its new First Time Buyer Isa to replace the Lifetime Isa. It is consulting on the new product, which will be solely for first-time buyers and not for the dual purpose of retirement saving as the Lifetime Isa… The post Government unveils First Time Buyer Isa details appeared first on Mortgage Finance Gazette.
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