Can I withdraw my money at any time?
If you withdraw your money for any reason other than buying your first home (up to the value of £450,000), or for retirement after 60, you will pay a government charge of 25% on the value of the withdrawn amount. Please bear this in mind before opening a Lifetime ISA. The net effect of the 25% bonus, then 25% penalty is that you lose £6.25 per £100 you pay in (excluding gains/losses and fees). Therefore, you should only pay in money that you’re sure will be used toward your first home or retirement. The account must be open for more than 12 months to be used towards a first home.
However, you won’t pay the government withdrawal charge if you withdraw from your Lifetime ISA because you are terminally ill (with less than 12 months to live).