Newcastle Building Society has begun accepting transfers into its cash Lifetime Isa following the launch of the product in October.
Initially Newcastle’s LISA had only been available to savers who were opening this type of product for the first-time with new money rather than those who wanted to move cash across from another provider.
But from today it will accept the transfer of lifetime ISAs from both stocks and shares and cash products held with other firms.
Any saver wishing to transfer a stocks and shares LISA to Newcastle would need to first convert it into a cash LISA with their current provider before moving the money across.
Newcastle Building Society is one of only three providers offering cash LISAs and its interest rate is a market-leading 1.1 per cent.
LISAs are a tax-efficient way to help first-time buyers save for a deposit or put away money towards retirement.
Skipton Building Society is the only other provider offering the product nationwide, with a slightly lower rate of 1 per cent, while Nottingham Building Society matches Skipton’s rate but through branches only.
Savers can open a LISA between the age of 18 and 39 and pay in up to £4,000 a year to benefit from a 25 per cent Government bonus – or £1,000.
Although those over 39 cannot open a LISA, those who already have one can continue paying into it until they are 50, which means that by saving the maximum amount they could receive a total Government bonus of £33,000.
They will only be able to keep the bonus if they go on to use their LISA to buy their first home or if they keep it invested until they are 60.
If customers withdraw money for any other reason then a 25 per cent penalty will be applied which means they will get back less than they have saved.
Newcastle Building Society customer director Stuart Miller says: “Following the successful launch of our Lifetime ISA back in October last year, we are pleased to be able to provide more choice for savers by being able to accept LISA transfers, whether it’s a cash, or a stocks and shares LISA.”
“With Help to Buy ISAs being removed this year, Lifetime ISA gives people another avenue to save their money, whether it’s a deposit for their home or saving for later life.”