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The short answer
Taking money out of a Lifetime ISA for any reason other than a first home, reaching 60, terminal illness or death triggers a 25% charge on the amount withdrawn, and moving abroad is not one of the exceptions. Because the charge is larger than the 25% bonus, you lose some of your own money: £1,000 withdrawn becomes £750. GOV.UK says you can keep an ISA open after you stop being UK resident, though you cannot pay in, so leaving the Lifetime ISA in place avoids the charge.
Some Nigerians who opened a Lifetime ISA in their twenties or thirties later decide to move on: back to Lagos, to Canada, or to wherever the next job is. The instinct is to close every UK account and take the money along. With a Lifetime ISA that instinct is expensive. The rules reward leaving it alone.
How the Lifetime ISA works
From GOV.UK:
- You must be 18 or over but under 40 to open one.
- You can pay in up to £4,000 a year until you are 50, and this counts towards the £20,000 annual ISA limit for 2026 to 2027.
- The government adds a 25% bonus, up to £1,000 a year.
- To open one and to keep paying in, you must be UK resident, or a Crown servant or member of the armed forces, or their spouse or civil partner.
Money can come out without a charge only in four cases: to buy a first home costing £450,000 or less, bought at least 12 months after your first payment, with a mortgage and through a conveyancer; when you reach 60; if you are terminally ill with less than 12 months to live; or on death. Everything else, including relocation, attracts the withdrawal charge.
The 25% charge, worked through
GOV.UK's own example: you pay in £800 and receive a £200 bonus, so the account holds £1,000. Withdraw it all and the 25% charge is £250, leaving £750. You have lost the bonus and £50 of your own money as well.
Worked example (illustrative): three years of saving
| Amount | |
|---|---|
| Paid in: £4,000 a year for 3 years | £12,000 |
| Government bonus at 25% | £3,000 |
| Balance before growth or interest | £15,000 |
| Withdrawal charge at 25% of £15,000 | £3,750 |
| You receive | £11,250 |
| Compared with what you paid in | £750 less |
The charge is a percentage of the whole withdrawal, so any interest or investment growth is also reduced by a quarter. The longer the account has run, the more you lose in pounds.
What happens if you keep it open after you leave
GOV.UK's page on ISAs when you move abroad says three things that matter here:
- You must tell your ISA provider as soon as you stop being UK resident.
- You cannot put money in while you are not resident, unless you are a Crown employee overseas or their spouse or civil partner.
- You can keep the ISA and still get UK tax relief on what it holds, and you can pay in again if you become resident again.
The Lifetime ISA's own pages repeat that residence is needed to open and keep paying in, and they do not say the account must be closed when you leave. So the usual position is a dormant Lifetime ISA that keeps earning interest or returns, with no new payments and no new bonus, until you either return and buy a first home, or reach 60 and withdraw without a charge.
Two points to check
- Tax in your new country. UK tax relief does not bind another country. If you become tax resident in Nigeria or elsewhere, interest or gains inside the ISA may be taxable there. See Nigerian tax residence after moving.
- The provider's own terms. Some providers restrict accounts for customers living abroad, for example online access or changing details. Ask before you leave, and keep a UK contact address and email up to date.
When withdrawing anyway can make sense
There are cases where people accept the charge: an urgent need for cash that cannot be met elsewhere, or a small balance where the loss in pounds is minor against the hassle of keeping a UK account. Work out the loss first. On a £2,000 balance, the charge is £500. If you can borrow that sum more cheaply for a short time, or wait, the Lifetime ISA is usually the last thing to cash in.
What to check before you leave
- Your Lifetime ISA balance and how much of it is bonus.
- Whether you might return to the UK and buy a first home within the price cap.
- How your provider handles non-resident customers.
- Where you will be tax resident, and whether that country taxes ISA income.
- The rest of your UK accounts: our guide to what happens to an ISA when you leave covers cash and stocks and shares ISAs too.
Where Pryme fits
If you relocate, you can still run your money across currencies from one Pryme Personal Account, which can be opened from any country (multicurrency), and convert with Swap, which shows the rate and the fee before you approve. A Lifetime ISA stays with its UK provider. See also Lifetime ISA eligibility on a visa.
Questions people ask
Do I have to close my Lifetime ISA if I leave the UK?
GOV.UK does not require it. You must tell the provider you are no longer UK resident and you cannot pay in, but you can keep the ISA open.
What is the Lifetime ISA penalty?
A 25% charge on the amount withdrawn, unless you are buying a first home under the rules, are 60 or over, are terminally ill, or the account holder has died.
Is emigrating an exception to the Lifetime ISA charge?
No. Moving abroad is not one of the exceptions listed by GOV.UK.
Can I use my Lifetime ISA to buy a house in Nigeria?
The first-home rules are built around a purchase with a mortgage through a conveyancer, under £450,000. Ask your provider in writing before relying on it for a home outside the UK.
Sources
- GOV.UK: Lifetime ISA, withdrawing money · accessed Oct 2026
- GOV.UK: Lifetime ISA, who can open one (updated 30 Sep 2026) · accessed Oct 2026
- GOV.UK: Lifetime ISA, overview (updated 30 Sep 2026) · accessed Oct 2026
- GOV.UK: Individual Savings Accounts, if you move abroad · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.