• The Government has announced a cut in the Lifetime ISA (LISA) exit charge from 25% to 20% as part of its COVID-19 response
• Reduction in LISA exit charge will take effect between 6th March 2020 and 5th April 2021
• Decision removes key barrier to LISA savers accessing their fund during COVID-19 crisis
Tom Selby, senior analyst at AJ Bell, comments:
“This is a sensible and pragmatic move by the Treasury in unprecedented circumstances.
“The 25% LISA exit charge always seemed unfair as it meant savers who withdrew their fund early could end up getting back less than they originally put in. But during a global pandemic when many young people will be struggling to make ends meet, applying the exit penalty would have been particularly cruel.”
