An estimated 150 Lifetime ISA holders have seen their annual bonus of up to £1,000 delayed by up to two months, MoneySavingExpert can reveal - so if you're expecting your bonus to have arrived, check now if it's been paid.
A Lifetime ISA (LISA) can be opened by anyone aged 18 to 39 and let's you save up to £4,000 in it each year. The state will then add a 25% bonus - so you can earn up to £1,000 in free cash each year.
Most LISA savers received their initial bonus after the end of the last tax year in April or May, but we've heard from several MoneySavers that haven't yet got the cash. Skipton Building Society told us up to 150 of its customers have experienced a delay, but that the issue wasn't specific to one provider.
It says that some of these cases are because customers have switched their LISA from another LISA provider, and their previous account is not registered as being closed or transferred on the HMRC system. Others are because HMRC holds different data on the customer to Skipton, creating a mismatch which has delayed the payment.
For how LISAs work, who they're for and all the best buys, see our Lifetime ISAs guide.
What are LISAs and who is due a bonus?
The Lifetime ISA (LISA) is a tax-free wrapper that lets you put up to £4,000 in it every year. It can be as cash savings, so you get interest, or stocks and shares investing, which means you get share growth (or loss).
The state will then add a 25%/yr bonus on top of what you save each year. So if you save £1,000, you'll have £1,250 and if you save the full £4,000, you'll have £5,000. And that's before interest or growth.
The first year's bonus - if you opened your LISA anytime during the last tax year - was supposed to be added to people's accounts in May, but for the tax year from April 2018, the bonus will be paid monthly.
You can hold more than one LISA at any one time, provided that you only pay in to one in each tax year (you can transfer the current year's money around, provided it's ALL transferred each time).
'My bonus was due in May'
We've heard from several savers over the past few weeks who have not yet received their LISA bonus, despite believing they have fulfilled all the requirements.
- MoneySaver James told us: "I’ve had an issue with getting my Lifetime ISA bonus paid from Skipton for over six weeks now. I met all of the conditions to qualify for the bonus yet I’m still to be paid the £1,000 into my account.
"At first they blamed HMRC and now Nutmeg - who I transferred my original LISA to Skipton from. It’s not a nice position for me, and many others by the sounds of it, to be in."
- Another, Francisco, said: "I've been trying to get the bonus payment on my cash LISA with Skipton, it was due on 4 May. However Skipton claims there is a mismatch between the records they have and HMRC's records.
"When I contacted HMRC I confirmed the details they held to be correct after amending an issue with the date of birth, which was one day out. Skipton is still claiming there is a mismatch on the records."
- Donncha said: "I initially opened a LISA with Nutmeg in April 2017. I transferred the Nutmeg LISA to a Skipton Cash LISA in March 2018. The bonus is still not received and now both Nutmeg and Skipton say there is nothing they can do - each are blaming the other.
"Skipton report that HMRC are trying to sort out bonus payment issue but after a few hours calling various departments at HMRC, nobody can shed any light."
Why bonuses haven't been paid
Skipton Building Society says there are two main reasons why LISA bonuses have not yet been paid:
- HMRC and the LISA provider hold different data on the saver. This could happen for example if a customer has recently got married, and applied for a LISA in their new name, but HMRC is not aware of this name change.
- A saver has switched their LISA and the old one hasn't been closed or transferred on HMRC's system. You can transfer your LISA to a new provider, for example to get a better interest rate, and you can then add to it. But you can't set up two LISAs and pay new money into them separately in the same tax year. When a LISA that has had money transferred from it isn't closed, then it appears to HMRC as though a customer has paid into two LISAs - the original, plus the one you've transferred into - and so, a bonus payment is delayed.
What to do if you haven't yet received your bonus
If you think you should have received a LISA bonus and it hasn't yet been paid, HMRC says you should first go to your LISA provider, to check the reason.
As a second port of call, it may be worth checking with HMRC that your details are correct on its system, especially if details such as your name have changed recently. You can contact it on 0300 200 3300.
What do HMRC and LISA providers say?
An HMRC spokesperson said: “HMRC has been educating and working closely with Lifetime ISA providers to ensure their customers receive bonus payments.
"Individuals experiencing issues with their Lifetime ISA should contact their provider for help and support.”
Skipton Building Society told us it has "proactively contacted" up to 150 customers it believes may have been affected.
Stocks and shares LISA provider Nutmeg told us around 60 of its LISA-holders who have transferred their LISA to a new provider, including Skipton, have experienced a delay in receiving their bonus.
It said it was "working together" with HMRC and other providers to ensure customers who have faced a delay can receive their payments as quickly as possible.