Managing a Lifetime ISA when an investor dies or is terminally ill
Find out about claiming government bonuses and making withdrawals if you're a Lifetime ISA manager and an investor dies or is terminally ill.
When an investor dies
When you are told that an investor has died, you should not accept any further payments into their Lifetime ISA.
Since 6 April 2018, the Lifetime ISA can remain open as a continuing account of a deceased investor.
You can claim a government bonus accrued on payments made into the Lifetime ISA on or before the date the investor died. The investor’s estate can only receive the government bonus once the Lifetime ISA has been closed.
You must withdraw and repay any government bonuses claimed on payments made after the date of death of the investor. This will be charge-free if you were unaware that the investor had died.
You can read more information on the inclusion of a government bonus in the calculation of additional permitted subscription limits.
When an investor is terminally ill
When a Lifetime ISA investor is terminally ill and you have received written evidence from a UK registered medical practitioner that the investor has less than 12 months left to live, any subsequent withdrawals will be charge-free.
A withdrawal in these circumstances does not require a closure of the Lifetime ISA. Subject to the wishes of the investor, you must keep the Lifetime ISA open and available to receive more payments from the investor.
Evidence from a UK registered medical practitioner proving that an investor has a terminal illness applies to the whole period in which the Lifetime ISA remains open, even if this is longer than the 12 month period set out in the written evidence provided by the investor.
When an investor is no longer a UK resident, you must obtain confirmation of terminal illness from a UK registered medical practitioner or an overseas equivalent of a registered medical practitioner.