I believe my confusion is to how a LISA is seen with regards to the law, compared to the other ISA types.

For example, I know you can pay into both a Cash ISA and a S&S ISA up to a combined limit of £20,000. I have a S&S LISA and given I'm basic rate self employed this is where I would be putting life savings into, however I also want to contribute to a standard S&S ISA if legal as then I can withdraw without the penalty I'd get if I were to withdraw from a LISA for say, a holiday, or car.

This is especially so given I can only put in £4,000 per annum into the LISA but I want to maximize the tax savings from the other £16,000 I have in terms of ISA allowance. Since Cash ISA interest rates aren't too high, I'd be looking to put savings into both the S&S LISA and then a S&S ISA in the same tax year.

1 Answer 1


Yes, this is fine:

You can save up to £20,000 in one type of account or split the allowance across some or all of the other types.

You can only pay £4,000 into your Lifetime ISA in a tax year


Example You could save £11,000 in a cash ISA, £2,000 in a stocks and shares ISA, £3,000 in an innovative finance ISA and £4,000 in a Lifetime ISA in one tax year.


You might want to consider whether it is wise to be fully invested in shares. If you're going to have to dip into them for things like holidays and a car, you're taking a risk that you might have to sell when the market is low.

As a basic rate taxpayer, you have a £1 000 personal savings allowance. You don't need to chase the tax break with a cash ISA, which often have poor rates. However, you should consider keeping some of your savings in cash, for example in a current account that pays decent interest on the balance.

  • Thanks Richard. For anyone else also stumbling on this I also found the technical design note which has some good illustration: gov.uk/government/uploads/system/uploads/attachment_data/file/… Also, naturally my savings are diverse and I do have a fair amount allocated to standard savings in cash form. My S&S ISA will likely go into a fund rather than myself managing the shares; the finances of which can then be used as general purpose savings - neither a house nor car are critical for me.
    – Talisman
    Oct 4, 2017 at 15:40

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .