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  "path": "/money/martin-lewis-lifetime-isa-penalty",
  "publishedAt": "2026-04-06T05:00:02.000Z",
  "site": "https://www.gbnews.com",
  "tags": [
    "Octopus Energy, British Gas and EDF customers urged to take meter reading TODAY for £117 saving",
    "Martin Lewis issues urgent warning to drivers amid £7.5bn car finance payouts",
    "Martin Lewis reveals clever trick to slash medication costs: 'It’s absolutely the same stuff!'",
    "The GB News Editorial Charter"
  ],
  "textContent": "\n\n\nMartin Lewis has criticised the 25 per cent penalty on Lifetime ISA withdrawals as \"ridiculously unfair\" for savers unable to buy within the scheme’s property limit.\n\nSpeaking on his BBC podcast, Mr Lewis highlighted the impact on first-time buyers who opened accounts when the scheme launched in 2017.\n\n###\n\n\n\n\nMr Lewis said: \"Clearly, it's ridiculously unfair to have that frozen.\"\n\nHe added: \"People got these products in 2017 thinking they were going to be able to use it.\"\n\n###\n\n\n\n\nTRENDING\n\nStories\n\nVideos\n\nYour Say\n\n###\n\n\n\n\nThe Lifetime ISA allows savers to contribute up to £4,000 each year, with the Government adding a 25 per cent bonus worth up to £1,000 annually.\n\nFunds can only be used towards a first home costing £450,000 or less, a threshold that has remained unchanged since the scheme was introduced.\n\nHouse price increases have meant some buyers are no longer able to use their savings without triggering penalties.\n\nMr Lewis said: \"Not only are they not going to get their bonus, but they're paying an effective penalty, so it's hideously unjust.\"\n\n###\n\n\n\n\n###\n\n\n\n\n###\n\n\n\n\nWithdrawals for properties above the limit, or for other purposes, incur a 25 per cent charge.\n\nThis removes the Government bonus and also reduces part of the saver’s original contributions.\n\nMr Lewis said some savers have been \"priced out of the market\" and now face paying \"a fine, a penalty to the state, for having opened a product that the state wanted them to.\"\n\nHe said he has been raising concerns about the issue for several years and has discussed it directly with Rachel Reeves.\n\n### LATEST DEVELOPMENTS\n\n\n\n\n  * Octopus Energy, British Gas and EDF customers urged to take meter reading TODAY for £117 saving\n  * Martin Lewis issues urgent warning to drivers amid £7.5bn car finance payouts\n  * Martin Lewis reveals clever trick to slash medication costs: 'It’s absolutely the same stuff!'\n\n\n\n###\n\n\n\n\n###\n\n\n\n\nMr Lewis said: \"I've spoken to Rachel Reeves about it.\"\n\n\"She said she's looking at doing it, she's told me that when they do the consultation on the LISA replacement, they will look at whether they will increase the £450,000.\"\n\nThe Government has confirmed plans to replace the Lifetime ISA following the Autumn Budget 2025.\n\nThe consultation process is expected to consider whether the property price cap should be adjusted.\n\nMr Lewis said he remained uncertain whether changes would be introduced.\n\n###\n\n\n\n\n###\n\n\n\n\nHe said: \"I don't know what's going to happen. I've had politicians look at me and effectively say, yes we'll up that limit at some point, and they've not done it.\"\n\nSavers are advised to plan based on the current rules remaining in place.\n\nMr Lewis said: \"You simply have to work on the assumption for the moment, that if you've got a Lifetime ISA, the limit is £450,000 and it's not going to change.\n\n\"I hope to be wrong, but I wouldn't be betting on being wrong.\"\n\nLifetime ISAs are available to those aged between 18 and 39, with contributions permitted until the age of 50.\n\n###\n\n\n\n\n\n\n\n\n\n\n**Our Standards: The GB News Editorial Charter**",
  "title": "Martin Lewis says Lifetime ISA penalty is 'hideously unjust' for first-time buyers amid £450k property cap"
}