Lifetime ISA Calculator — 25% Bonus
LISA growth with the government's 25% bonus on up to £4,000/year — first home or retirement, penalty math included.
Formula
Disclaimer: Assumes constant returns; market investments fluctuate and tax rules change — verify current-year limits. Educational math only, not financial or tax advice.
Disclaimer: This tool is for general informational and estimation purposes only and is not professional financial, tax, accounting or legal advice. All figures are estimates — verify with a qualified professional before making decisions. Read the full disclaimer.
Need lifetime isa calculator results fast? Skip the spreadsheet and get a clear, defensible answer in one step — free, private and instant, recalculating live as you change any input.
About Lifetime ISA Calculator — 25% Bonus
The Lifetime ISA is the only mainstream UK account where the government simply hands you 25%: contribute up to £4,000 a year (ages 18–39 to open, bonuses until 50) and £1,000 of free money lands annually before compounding even starts. The defaults — maxed for 10 years at 6% — build roughly £70,000, including £10,000 of pure bonus. Its two sanctioned exits define its users: FIRST HOME (up to £450,000 purchase price, account open 12+ months, funds via conveyancer) — for first-time buyers saving a deposit, nothing else matches a guaranteed 25% uplift; and AGE 60+ for retirement, where it complements pensions (no tax on the way out, unlike pension drawdown). Anything else triggers the 25% WITHDRAWAL PENALTY — which, by asymmetric math, claws back more than the bonus (25% off the gross exceeds the 25% added to the net): you lose ~6.25% of your own money. Positioning: capture employer pension match first (free money at higher multiples), then LISA for a defined house plan or as a basic-rate taxpayer's retirement supplement; the £4,000 counts inside the overall £20,000 ISA allowance. The £450,000 house-price cap hasn't moved since 2017 — London buyers should sanity-check their target price before relying on it.
How to use Lifetime ISA Calculator — 25% Bonus
- 1Enter Yearly contribution (max £4,000), Expected annual return (%), Years contributing (18–50, bonus to 50) (years) into the Lifetime ISA Calculator.
- 2The result is computed automatically using Each year's contribution is topped up 25% by the government (max £1,000/yr), then everything compounds tax-free — there is no button to press; it updates live as you type.
- 3Change any input to model a different scenario, then use “Copy result link” to share the exact numbers.
Why use Lifetime ISA Calculator — 25% Bonus?
- ✓Computes lifetime isa calculator instantly with the correct formula — no spreadsheet needed
- ✓100% free and unlimited, with no sign-up, login or paywall
- ✓Runs entirely in your browser, so the figures you enter are never uploaded or stored
- ✓Shows the formula, a live worked example and references so you can defend the number
Frequently asked questions
How does the 25% penalty actually lose me money?+
The bonus adds 25% of your contribution; the penalty takes 25% of the WITHDRAWAL (contributions + bonus + growth). Put in £4,000 → £5,000 with bonus; withdraw unauthorized → £5,000 − 25% = £3,750: £250 of YOUR money gone, plus any growth taxed by the same haircut. The penalty isn't 'losing the bonus' — it's worse.
LISA or Help to Buy ISA leftovers?+
LISA dominates for new savers: bigger annual room (£4,000 vs £2,400), bonus paid into the account (compounding!) rather than at completion, and a £450k price cap vs £250k outside London. H2B closed to new accounts in 2019; holders can transfer into LISA within limits. New first-time buyers: LISA, full stop.
Can couples both use LISAs for one house?+
Yes — if BOTH are first-time buyers, both pots (and both bonuses) can fund the same purchase: up to £8,000/year of contributions earning £2,000/year of bonuses toward one deposit. If one partner has owned property before, only the other's LISA can be used penalty-free.
Cash LISA or stocks LISA?+
Buying within ~5 years: cash LISA — a 20% market drawdown the year before exchange is a real risk equities carry. Retirement-horizon (decades): stocks & shares LISA, where the 25% bonus plus compounding works hardest. Some providers allow switching as the goal approaches; plan the glide path.
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