Ndubuisi 'Andy' EgwimMoney Coach for Medics|Ex-NHS GP|21+ Yrs Investor| Founder, MoneyWiseDoctor.com|Helping Medics Avoid Big Money Mistakes

Moving Abroad? How It Freezes Your Lifetime ISA Contributions!

26 Sept 2024 · 1 min

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Ndubuisi 'Andy' Egwim explains that leaving the UK stops Lifetime ISA contributions: if you are no longer a UK tax resident you cannot contribute to a Lifetime ISA. He warns this can effectively freeze retirement or home-buying savings — contributions stop and, if you withdraw before retirement, you may face a 25% penalty. The speaker gives an anecdote about a friend who moved abroad for work and found their Lifetime ISA frozen and subject to penalties on early withdrawal.

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Leaving the UK stops your contribution. So what if you move abroad? What if you're no longer a resident tax resident in the uk, you wouldn't be able to contribute to your license anymore. Whether you are thinking of moving to any other country Canada, New Zealand, Australia or whatever is a big issue. All right, if you've used it, buy your first home. But if you're saving for retirement, it could be cut out. A friend of mine was caught off guard with this kind of situation. He moved abroad for work and the license was essentially frozen. And if they wanted to withdraw the money before retirement, they would face that 25% penalty. So imagine having a savings account you can't touch or even contribute to, even though you're still working towards your financial goals.