How you can claim a free £1000 from the government

We promise this isn’t one of those suspicious articles-that-are-actually-adverts you see floating around news sites these days – often next to a piece about treating a fungal nail infection or something.

No, this is actually free money from the UK government.

And we thought April Fool’s Day was on Friday…

Cheers, Rishi!

The free grand actually relates to what’s known as a Lifetime ISA (Individual Savings Account), which allows you to stash away £4,000 of your cash, each year, in an account to go towards your first house or retirement.

The extra £1,000 comes in the form of a 25 per cent bonus from the government - if you save the full £4,000, that is.

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Account-holders will also get tax-free interest (i.e. more money) on what they save, too.

Anyone aged between 18 and 39 can open up a Lifetime ISA, and you can contribute to that and a cash ISA in the same financial year.

This is where the urgency comes in, as the new tax year – 2022/23 - starts on 6th April.

If you miss that deadline, you can still apply for a Lifetime ISA, but you’d be waiting a little while longer to get the free wonga than if you did it just before the end of this tax year.

And just to cover our backs, Money Saving Expert Martin Lewis suggests it’s a good idea, too.

Writing in his weekly ‘Money Tips’ email, Lewis said: “While cash ISAs aren’t much cop for most, other ISAs can be.

“If you’re a first-time buyer, check out the Lifetime ISA’s 25 per cent boost worth up to £1,000/year on your first home.”

In order to use the savings to help you buy your first home, you must be looking to buy a property that costs £450,000 or less; buy it at least 12 months after you make your first ISA payment; use a conveyance or solicitor to help with the purchase and buy it with a mortgage.

More information about the Lifetime ISA can be found on the GOV.UK website.

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