Yes – you can open a Lifetime ISA if you already have other types of ISA, as long as you are eligible for the account. Please keep in mind that your government imposed personal ISA usage allowance of £20,000 per tax year is shared across all of the types of ISAs that you have. The Lifetime ISA allowance of £4,000 per tax year counts towards this overall £20,000 per tax year ISA allowance. One other thing to note is that you can have both a Help to Buy ISA AND a Lifetime ISA, but when the time comes to buy a home, you can only use the bonus from one of these types of account towards the purchase. For more info on transferring the funds from your Help to Buy ISA into a Lifetime ISA, read this article.
ISA Transfers and Contribution Limits
Transferring funds between ISAs does not count as a new contribution and, therefore, does not affect your annual £20,000 ISA allowance. For instance, if you move your Lifetime ISA to another provider, the original contribution dates are retained. Similarly, transfers of other ISA funds within the same tax year will have allowance adjustments communicated to providers as necessary.
Tax Year Boundaries and Contribution Timing
Contributions made after April 6 are automatically counted toward the new tax year. There are no options to allocate contributions retroactively to a previous tax year, even if the timing is close to the end of a tax year.
Additional Notes on First-Time Buyer ISA Rules
If you withdraw funds from your Lifetime ISA for a first home purchase, the withdrawal does not reduce your overall £20,000 ISA allowance. However, please be aware that withdrawn funds cannot be replaced during the same tax year due to Lifetime ISAs not having a flexible feature.