45,000 Lifetime Isa savers hit by withdrawal charges more than once in 2024-25
HMRC figures obtained by the money app Plum show about 45,000 Lifetime Isa savers were charged for unauthorised withdrawals more than once in 2024-25, losing an average of about £760. The figures add to debate over the planned replacement first-time buyer Isa.
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The story, neutrally told
Mixed · 2About 45,000 Lifetime Isa (Lisa) savers were hit with unauthorised withdrawal charges more than once in the 2024-25 tax year, according to HM Revenue and Customs (HMRC) figures rounded to the nearest 100. Evening StandardN “Around 45,000 Lifetime Isa (Lisa) savers were hit with unauthorised withdrawal charges more than once in 2024–25” Read at Evening Standard ↗ City A.M.RC “Roughly 45,000 savers were penalised for unauthorised withdrawals from Lifetime ISAs (LISA) in the 2024/25 tax year” Read at City A.M. ↗ Centre · 1The figures were obtained by the money app Plum through a freedom of information request to HMRC. Evening StandardN “The figure, which was rounded to the nearest 100, was obtained by money app Plum following a freedom of information (FOI) request.” Read at Evening Standard ↗ Mixed · 2The average saver penalised more than once lost around £760 that year, and 33,530 of them were in the most common bracket, with charges of up to £999. Evening StandardN “The most common charge bracket, among those hit with charges multiple times, was for charges of up to £999. Around 33,530 savers were in this bracket.” Read at Evening Standard ↗ City A.M.RC “The average saver penalised more than once lost roughly £760, as 33,530 were hit with fines ranging up to £999.” Read at City A.M. ↗
Mixed · 2At the top end, around 60 savers faced charges totalling £8,000 or more, and around 60 others incurred £7,000 to £7,999; City A.M. adds that nearly 4,000 incurred charges above £2,000. Evening StandardN “Around 60 savers faced charges adding up to £8,000-plus in the tax year 2024-25, while around 60 others incurred charges of £7,000 to £7,999.” Read at Evening Standard ↗ City A.M.RC “Nearly 4,000 Brits incurred fines in excess of £2,000, while 60 were slapped with charges surpassing a staggering £8,000.” Read at City A.M. ↗ Centre · 1HMRC told Plum the average of the top 25 cumulative penalties per individual penalised more than once in the same tax year was £11,000 in 2024-25. Evening StandardN “HMRC said this was £11,000 in 2024-25, rounded to the nearest £100.” Read at Evening Standard ↗ Right · 1City A.M. reports that those penalised multiple times made up around a third of the 129,200 people penalised in 2024-25. City A.M.RC “Brits who suffered multiple LISA penalties accounted for around a third of the 129,200 people penalised that tax year.” Read at City A.M. ↗
Centre · 1A Lifetime Isa adds a 25% government bonus on savings up to £1,000 a year, but a 25% charge applies to unauthorised withdrawals, for example by someone under 60 who is not buying a first home. Evening StandardN “A 25% bonus is added to savings, up to a maximum of £1,000 per year.”“But a charge of 25% can apply of someone makes an unauthorised withdrawal” Read at Evening Standard ↗ Right · 1City A.M. gives an example: £1,000 saved becomes £1,250 with the bonus, but withdrawing it in cash costs £312.50, leaving £937.50. It also notes that buying a home above the £450,000 cap, unchanged since 2017, counts as an unauthorised withdrawal. City A.M.RC “if they withdrew that £1,250 in cash they would lose £312.50, leaving them with £937.50.”“Purchasing a home above this cap is classified as an unauthorised withdrawal, triggering the penalty.” Read at City A.M. ↗ Centre · 1Earlier HMRC figures released in September showed £118,985,000 in Lifetime Isa withdrawal charges in 2025-26, with 154,100 people making unauthorised withdrawals. Evening StandardN “Figures previously released by HMRC in September show £118,985,000 in withdrawal charges was recorded for Lifetime Isas in 2025-26.”“Some 154,100 people made unauthorised withdrawals in that year.” Read at Evening Standard ↗
Mixed · 2The government plans to replace the Lifetime Isa with a first-time buyer Isa. A consultation on its design closed in August 2026 and no launch date has been given, and existing account holders can keep saving into Lifetime Isas. Evening StandardN “A Government consultation seeking views on the design and implementation of a new first-time buyer Isa closed in August 2026.” Read at Evening Standard ↗ City A.M.RC “The new product, which is yet to be given an official launch date by the government” Read at City A.M. ↗ Right · 1City A.M. says the new product is expected to drop the retirement option, add the bonus only when a saver buys a property, have no upper age limit and remove cash withdrawal penalties. It adds that the Treasury conceded the Lifetime Isa was "not working well for many". City A.M.RC “is expected to remove the option of using funds for retirement and add the bonus only when a saver is ready to purchase a property.”“The government conceded the product was “not working well for many” and “putting off some savers”.” Read at City A.M. ↗ Centre · 1Plum's Rajan Lakhani said the data would "anger many" and focus minds on making the new product fit for purpose, calling the sums "significant" for first-time buyers. PensionBee's Maike Currie said the figures "expose a fundamental flaw" in the Lifetime Isa. Evening StandardN “What the data shows will anger many and focus minds on ensuring the new first-time buyer Isa is fit for purpose.”“These figures expose a fundamental flaw in the Lifetime Isa.” Read at Evening Standard ↗
Right · 1Providers disagree on the fix: some want a regional rather than national price cap, and Plum wants the national limit raised to roughly £600,000. Moneybox's Brian Byrnes argues the Lifetime Isa should be improved, not replaced, with changes to the withdrawal penalty and house-price cap made now. City A.M.RC “providers are urging the government to remove the national cap in favour of a regional one”“We should not replace a product that is already helping people buy a home with a new first-time buyer ISA.” Read at City A.M. ↗
Every sentence links to the reporting it rests on. The pill in front of each says where its sources sit: Left, Centre or Right when one side supplies at least half of them, Mixed when they are evenly split. The number is how many outlets it cites.
Left0 outlets
No left outlet in our sources has covered this story yet.
Centre1 outlet
- Framing
- Data-led report of the HMRC figures obtained by Plum, with the charge brackets and the earlier 2025-26 totals.
- Emphasis
- Statistics, the structure of the bonus and charge, and comment from Plum and PensionBee on the Lifetime Isa's flaws.
- Leaves out or plays down
- Does not mention the debate over replacing versus reforming the product or the proposed regional price cap.
- Charged language
- “fundamental flaw”
- For example
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“These figures expose a fundamental flaw in the Lifetime Isa.” — Evening Standard
“Around 60 savers faced charges adding up to £8,000-plus in the tax year 2024-25” — Evening Standard
Right1 outlet
- Framing
- Frames the figures as savers being penalised, tied to the house-price cap and the policy fight over the replacement product.
- Emphasis
- The frozen £450,000 cap, regional house prices, a worked example of the penalty, and industry disagreement over replacing the product.
- Leaves out or plays down
- Does not give the 2025-26 HMRC totals reported by the Standard.
- Charged language
- “slammed”“slapped”“staggering”“flawed and outdated”
What every side reports
- About 45,000 savers were penalised more than once in 2024-25, per HMRC data obtained by Plum via FOI.
- The average such saver lost around £760, and 33,530 faced charges up to £999.
- Around 60 savers faced charges of £8,000 or more.
- A first-time buyer Isa is planned to replace the Lifetime Isa, with no launch date yet.
Where accounts differ
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Whether the Lifetime Isa should be replaced
- Centre
- Reports the replacement plan and PensionBee's view that the figures expose a fundamental flaw in the Lifetime Isa.
- Right
- Reports the replacement plan, but also gives Moneybox's argument that the Lifetime Isa should be improved now rather than replaced, because the new product adds complexity.
Plum organisation
Plum, which obtained the figures, says the charges are significant for first-time buyers and should focus minds on making the new product fit for purpose. It also wants the national house-price cap raised to about £600,000.
“These are significant sums of money for first-time buyers who already face considerable obstacles to getting a foot on the housing ladder.” — Evening Standard
“others, including Plum, have called for the national limit to be increased to roughly £600,000.” — City A.M.
Lifetime ISA topic
The Lifetime Isa is criticised as restrictive and dual-purpose. The government has conceded it is not working well for many and plans a replacement, while some firms want it reformed instead.
“The government conceded the product was “not working well for many” and “putting off some savers”.” — City A.M.
“Rules around Lifetime Isas have previously been criticised for being too restrictive” — Evening Standard
Left0 articles
No coverage yet.
Centre1 article
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45,000 Lifetime Isa savers hit more than once in a year with withdrawal charges
Neutral Straightforward data report on the HMRC figures with expert comment on the Lifetime Isa's flaws.
Right1 article
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Thousands of Lifetime ISA savers slammed with multiple withdrawal penalties
Critical Emphasises savers being penalised, links it to the frozen price cap and includes the industry debate over replacement.
- 8 Oct 00:01 First Evening StandardN 45,000 Lifetime Isa savers hit more than once in a year with withdrawal charges
- 8 Oct 13:37 +13h 37m City A.M.RC Thousands of Lifetime ISA savers slammed with multiple withdrawal penalties
Times are when each article was published, or when we first saw it if the outlet gave no time.