Lifetime ISA exit charges more than triple during lockdown

FOI request

Sophie King
clock • 2 min read

Lifetime ISA (LISA) early withdrawal charges more than tripled in a year, a Freedom of Information (FOI) request submitted by Quilter has revealed.

In the tax year 2019/20, early withdrawal charges came to just £10m, compared to £33m for the year 2020/21. Over the previous three tax years, £48m has been collectively levied against LISA holders for early withdrawals. However, only a small portion of that For 2018/19 and 2019/20 the withdrawal charges were set at 25% before being dropped to 20% from March last year to April 2021. This was to help people impacted by the pandemic to access funds; the temporary reduction of withdrawal charges meant account holders would only have to pay back the 25% government bonus they received. Howeve...

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