Key features of the Dodl investment Lifetime ISA

What's this about?
Dodl investment Lifetime ISA aims
Your commitment
The risks
Questions and answers
Important notes

What’s this about?

The Financial Conduct Authority (FCA) is a financial services regulator, and AJ Bell Securities Limited is the Dodl investment Lifetime ISA provider. The FCA asks that AJ Bell Securities gives you the most important details of the Dodl investment Lifetime ISA in one place - here, in the key features - to help you decide if it's right for you.

Read the key features carefully so that you understand everything you need to about the account before opening it. You can come back and remind yourself of them whenever you need to.

Though they're important, they shouldn't be intimidating! If there are any features you don’t quite understand or need more details on, chat to Team Dodl in the app or email them at hello@dodl.co.uk – it’s what they’re here for.

Dodl investment Lifetime ISA aims

To help you save and invest towards your first home and/or your retirement.
For you to take advantage of the 25% Lifetime ISA government bonus and ISA tax benefits, by making one-off or monthly payments into your Lifetime ISA.
To give you the opportunity to grow your savings by investing them, with any growth and income your Lifetime ISA investments make being tax-free.
For you to have complete control over how your savings are invested, from Dodl’s straightforward range of funds, themes and shares.

Your commitment

Before opening a Dodl investment Lifetime ISA, you’ll need to understand its features, benefits and risks - to check it’s what you expect and need.
You’ll make sure that any single or monthly payments you make to your investment Lifetime ISA won’t cause you to exceed the Lifetime ISA allowance (currently £4,000) or the overall ISA allowance (currently £20,000).
Except where you're transferring from another Lifetime ISA, you agree to make a payment into your investment Lifetime ISA in the same tax year you open it. And you won’t pay into another Lifetime ISA in the same year you pay into your Dodl investment Lifetime ISA (it’s a LISA rule).
You’ll decide and manage how your investment Lifetime ISA is invested.
You understand and agree to the investment Lifetime ISA terms and conditions and its charges, which may change in future.
After opening your investment Lifetime ISA, you’ll regularly check whether it is still the right account for your needs and expectations. Particularly if you’re no longer saving for your first home and/or retirement in this way.
You understand that you’ll have to pay the government’s 25% withdrawal charge if you take money out of your investment Lifetime ISA before you’re 60 and don’t use it help you buy your first home (unless you have a terminal illness).

The risks

Go in with your eyes open. Here are some risks to know about before opening a Dodl investment Lifetime ISA.

When deciding if a Lifetime ISA is right for you

Lifetime ISAs aren’t for everyone. Here’s why:

You can’t continue to pay into your Lifetime ISA once you’ve reached age 50 or if you move abroad.
If you take money out of your Lifetime ISA before turning 60, and you’re not withdrawing it to buy your first home (up to £450,000) or because of a terminal illness, you’ll have to pay the 25% government withdrawal charge on the amount you take out. This means you could get back less than you paid into your Lifetime ISA.
You’ll also pay the 25% government withdrawal charge if you take money out within 12 months of first paying into your Lifetime ISA.
If you choose to save into a Lifetime ISA instead of enrolling in and contributing to your workplace pension, you’ll miss out on your employer’s pension contributions, and your current and future entitlement to means-tested benefits could also be affected.

When investing within a Lifetime ISA

Investments should be held for the long term (5+ years) as their value, and any income they make, can go down as well as up. And you could get back less than the amount you originally invest.
The past performance of your investments doesn't predict how they'll perform in future. This means there are no guarantees over how much your Lifetime ISA will be worth when you withdraw it for your first house deposit (or after the age of 60).
You don’t currently pay tax on the income or profits investments make in a Lifetime ISA, but these rules may change in future.
Dodl doesn’t offer investment advice. But you’ll find plenty of information about your investment options in the app or on the website. We’ll also provide you with educational content to help you as you start to use Dodl. The information is there to help you make your own choices but mustn’t be treated as a recommendation or advice.
If you’re looking to purchase your first home soon, it’s important to consider if saving as cash is more appropriate than investing. Dodl doesn’t offer a cash Lifetime ISA but other providers such as banks and building societies do.

If you feel unsure about the risks involved with an investment Lifetime ISA, you should talk to a financial adviser. It’s also worth checking out moneyhelper.org.uk, the government’s free money guidance service.

Questions and answers

Before opening a Dodl investment Lifetime ISA

What’s an ISA?

ISA stands for individual savings account. They’re a way of saving and investing tax-free.

There are four different types of ISA:

Cash ISA
Investment ISA (also called stocks and shares ISA)
Innovative finance ISA
Lifetime ISA (can be either cash or investment)

You can only pay into one Lifetime ISA each tax year. So if you’re paying into a Lifetime ISA with Dodl, you can’t pay into another Lifetime ISA in the same tax year. But you can pay into both a Lifetime ISA and an investment ISA, for example, as they’re different types of ISA.

Dodl offers both an investment Lifetime ISA and an investment ISA, and you can open and manage both easily in the app.

What’s a Lifetime ISA?

A Lifetime ISA is designed specifically for people saving for their first home or retirement. Lifetime ISAs come in two varieties: cash or investment Lifetime ISAs. Dodl’s is an investment Lifetime ISA, meaning you can invest your Lifetime ISA savings for the opportunity to grow what you save.

The main benefit of any Lifetime ISA is a 25% government bonus - for every £4 you save, the government will add an extra £1. As you can pay in up to £4,000 each tax year, that’s up to £1,000 in annual bonuses.

That’s a big boost! But you should only invest in a Lifetime ISA if you’re definitely planning to use it to help buy your first home (up to a value of £450,000), or for retirement from age 60. If you end up using your Lifetime ISA for any other purpose, then 25% of the amount you take out will be paid back to the government – this is called the government withdrawal charge.

Could an investment Lifetime ISA be right for me?

Ask yourself the following questions:

Do I want to save and invest towards my first home (up to £450,000) and/or retirement after age 60?
Am I looking to build an investment portfolio, which is protected from UK capital gains and income tax, to potentially grow my savings?
Do I want to benefit from the 25% government bonus on the amount I pay into a Lifetime ISA (within the Lifetime ISA allowance)?
Do I understand that investment growth isn’t guaranteed?
Do I understand that the 25% government withdrawal charge will apply for any money I take out of my investment Lifetime ISA before age 60 and isn’t used to help buy my first house? (If you’re terminally ill the withdrawal charge won’t apply.)
Do I understand that the 25% government withdrawal charge will also apply for any money I take out of my Lifetime ISA within 12 months of first paying into it?
Do I want to choose my own investments from a straightforward range of funds, themes and shares, and manage these easily through an app?

If you answered ‘yes’ to every question, then the Dodl investment Lifetime ISA could be right for you. These key features should give you all the details you need to decide, but if you still feel unsure, you should speak to a financial adviser about this.

Can I open a Dodl investment Lifetime ISA?

To open an investment Lifetime ISA with Dodl you'll need to be a UK resident, or a Crown employee working abroad or the spouse or civil partner of someone who is.

You'll also need to be age 18 or over, and under 40 (unless you're transferring an existing Lifetime ISA to Dodl).

You won’t be able to open and pay into an investment Lifetime ISA if you’ve already paid into another Lifetime ISA this tax year, unless you transfer that other Lifetime ISA to Dodl first.

You won't be able to open a Dodl LISA if you are a US or Canadian citizen or resident for tax purposes.

What are the charges?

You'll pay the Dodl account charge for your Lifetime ISA

How much is it?	How is it calculated and collected?
0.15% a year (min £1 a month)	The charge is calculated based on the total value of the investments in your account. It’s collected in monthly instalments from the available cash in your Dodl Lifetime ISA.

Quick example of how the Dodl account charge works

For a Lifetime ISA with an investment value of £10,000, you’d pay:

0.15% of £10,000 over the course of the year – that’s £15 overall, taken in instalments of £1.25 a month. Just remember the minimum account charge is £1 a month (or £12 per year).

You can calculate what your Dodl account charge may look like using our handy charges calculator.

Any other charges?

Though there are no dealing charges when you buy/sell your investments (including when your monthly investments are bought), there will be investment charges paid separately to your Dodl account charge. These include fund ongoing charges, stamp duty for UK shares and foreign exchange charges for US shares. Find out more about these charges.

What about interest?

Cash held in your Dodl Lifetime ISA currently earns tax-free interest of 5% (5.09% AER variable). It’s important to remember that the interest rate will change from time to time. When it does, we’ll send you and email to let you know.

Find out more about the interest paid on cash held in your Lifetime ISA.

A little more info about interest: Banks do pay AJ Bell for the total money held with them for all AJ Bell customers, including Dodl customers. The amount a bank pays varies, depending on the total cash held with them and the market interest rates. For now, AJ Bell expects these payments to be between 0.10% below and 0.15% above the current Bank of England base rate for cash held in an ISA – but it could be higher or lower than this during periods of continuous base rate changes. We put some of these payments towards the interest rate we pay you, as mentioned above, and the rest towards keeping your Dodl charge as low as possible.

What could my Lifetime ISA be worth when I’m 60?

This table helps you understand what the value of your Lifetime ISA could be when you’re 60, depending on the age you start saving into it. The figures shown assume:

you’ll pay in the maximum allowed at the start of each tax year until age 50 and receive the government bonus each year for this.
there are no changes to the tax allowances and bonuses whilst you're saving.

The table may not be relevant to you if you’re using a Lifetime ISA to save towards your first home purchase rather than retirement.

Age you start saving:	18
Total amount paid into your Lifetime ISA	£128,000
Total amount paid into your Lifetime ISA, plus govt. bonus	£160,000
Estimated outcome at age 60 from 0% return	£78,894.87
Estimated outcome at age 60 from 5% return	£309,746.34
Charges and estimated inflation would reduce a 5% return to	2.4%
Age you start saving:	25
Total amount paid into your Lifetime ISA	£100,000
Total amount paid into your Lifetime ISA, plus govt. bonus	£125,000
Estimated outcome at age 60 from 0% return	£66,905.25
Estimated outcome at age 60 from 5% return	£221,151.01
Charges and estimated inflation would reduce a 5% return to	2.4%
Age you start saving:	30
Total amount paid into your Lifetime ISA	£80,000
Total amount paid into your Lifetime ISA, plus govt. bonus	£100,000
Estimated outcome at age 60 from 0% return	£56,853.33
Estimated outcome at age 60 from 5% return	£166,118.70
Charges and estimated inflation would reduce a 5% return to	2.4%
Age you start saving:	35
Total amount paid into your Lifetime ISA	£60,000
Total amount paid into your Lifetime ISA, plus govt. bonus	£75,000
Estimated outcome at age 60 from 0% return	£45,358.95
Estimated outcome at age 60 from 5% return	£117,111.71
Charges and estimated inflation would reduce a 5% return to	2.4%
Age you start saving:	40
Total amount paid into your Lifetime ISA	£40,000
Total amount paid into your Lifetime ISA, plus govt. bonus	£50,000
Estimated outcome at age 60 from 0% return	£32,215.12
Estimated outcome at age 60 from 5% return	£73,470.34
Charges and estimated inflation would reduce a 5% return to	2.4%

The figures shown are based on investment returns of 0% and 5% and inflation of 2.5%. The actual or expected returns you make are likely to be different, as these will depend on the investments you choose - different investments will give different returns.

Charges are based on the annual Dodl account charge of 0.15% (min. £1 per month), which may change in future. The figures in the table don’t include the charges from the investments you choose for your Lifetime ISA.

What other terms and conditions apply?

The Dodl investment Lifetime ISA terms and conditions and those of the Dodl app are included in the full terms and conditions.

Can Dodl offer me advice?

Dodl can’t offer you advice and isn’t authorised to give advice on tax, investments, or any other money matter. If you think you might need advice, you should contact a suitably qualified financial adviser - who should also let you know about the cost of advice.

If you decide to look for an adviser, again, moneyhelper.org.uk is usually a good place to start.

Paying into your Dodl investment Lifetime ISA

Who can pay into my Lifetime ISA?

Only you can make payments into your Lifetime ISA and they’ll need to come from a UK bank account with your name on it (it can be a joint account).

Once your Lifetime ISA is open, you’ll need to pay into it in the same tax year you open it or before your 40^th birthday – whichever is earliest – or it will be closed.

You won’t be able to make any more payments into your Lifetime ISA from the age of 50.

What is the minimum amount I can pay into my Lifetime ISA?

To get started with a one-off payment to your Lifetime ISA, you'll need to add a minimum of £100. If you're setting up a direct debit to automate adding cash to your account every month, that's a minimum of just £25.

What is the maximum amount I can pay into my Lifetime ISA?

Each tax year, you can pay in up to the Lifetime ISA allowance, which is £4,000 (this doesn’t include the 25% government bonus).

Your Lifetime ISA payments will also count towards your overall ISA allowance, which is currently £20,000 – but the government bonuses won’t. If you do have a Lifetime ISA and another type of ISA, keep an eye on how much you’re paying into your ISAs in total as if you go over the allowance HMRC will contact you to correct this

How does the government bonus work?

Your Lifetime ISA will receive a 25% government bonus on the payments you make into it. The total maximum bonus you can receive each tax year is £1,000 – that’s 25% of the Lifetime ISA allowance of £4,000.

You don’t need to do anything to claim your bonus – Dodl will always sort it for you. Your bonus will be paid into your Lifetime ISA 4–10 weeks after you make a payment, depending on the date of your payment. Here’s how it works:

On the 6th of every month Dodl will check your Lifetime ISA for any payments you made to it in the previous month. If you’ve made any payments, Dodl will apply to HMRC to claim your 25% bonus on it. HMRC will then send your bonus to Dodl, which you’ll receive as cash directly into your Lifetime ISA. These steps usually take around 4 weeks in total.

So if you make a payment to your Lifetime ISA on the 5th of the month, you’ll get in just in time for the 6th and receive your bonus around 4 weeks later. But if you make a payment on the 7th of the month, it’ll be nearly a month before the next bonus claim is submitted to HMRC, then another month before you receive it.

This timeline is worth bearing in mind when you’re getting close to buying your first home.

How can I pay into my Lifetime ISA?

You can make quick one-off payments to your Lifetime ISA at any time in the Dodl app using Google/Apple Pay, debit card or an easy bank transfer. Or set up a direct debit to add cash, automatically, at the start of every month. You can edit or cancel your direct debit at any time in the app too.

Transferring into or out of your Dodl investment Lifetime ISA

What types of ISA can I transfer into my Lifetime ISA?

You can usually transfer any of the following types of ISA into your Lifetime ISA:

Cash or investment (stocks and shares) Lifetime ISAs
Help to buy ISA
Stocks and shares ISA
Cash ISA

How do I transfer another Lifetime ISA or other type of ISA into my Lifetime ISA?

Log in to the app and open your Lifetime ISA. Once it's open tap the option on your dashboard to transfer an account . You'll then be asked for the details of the account you want to transfer into your new Lifetime ISA and how you’d like to transfer it.

After you've submitted your transfer details, Team Dodl will handle the rest. No need to contact your existing provider to let them know you’re transferring, either – the team'll do this for you too.

Good to know: you may be able to transfer part of an ISA or Lifetime ISA in to your Dodl Lifetime ISA, but you'll need to transfer all or none of your current tax year payments. This is because current year ISA payments can't be separated (it's an ISA rule).

Transferring from another Lifetime ISA

You can make your transfer as cash and/or investments. Though you’ll only be able to transfer in investments which are in the Dodl investment range.

This type of transfer does not count as a new Lifetime ISA payment, so doesn't count towards your Lifetime ISA allowance or overall ISA allowance.

Transferring from another type of ISA

If you’re transferring from a help to buy ISA, stocks and shares ISA or cash ISA into your Lifetime ISA, you’ll only be able to transfer as cash, not investments.

This type of transfer counts as a new Lifetime ISA payment, so the maximum amount you can transfer is your remaining Lifetime ISA allowance. The transfer won’t count towards your overall ISA allowance of £20,000 though.

Can I transfer my Lifetime ISA to another provider?

You can transfer your Dodl investment Lifetime ISA to another provider at any time. You can transfer it to another Lifetime ISA as cash and/or investments. But you’ll only be able to transfer your investments to another investment (stocks and shares) Lifetime ISA, and you’ll need to check with your new provider that they can accept them first.

If you're aged 40 or over, it's important to check that your new Lifetime ISA provider can accept a transfer in first.

You can transfer your Lifetime ISA to another type of ISA, but it’ll count as a withdrawal from your Lifetime ISA and will be subject to the 25% government withdrawal charge.

Investing within your Dodl investment Lifetime ISA

What can I invest in?

Choosing investments can be scary. That’s why Dodl doesn’t overcomplicate things. You can pick from a straightforward range of funds, themes and shares, designed to make investing easier. That includes:

AJ Bell funds – built and balanced by the experts at AJ Bell to make investing as simple as possible. Just choose the risk level which suits you, then you’re away.
Themed investments – build an investment portfolio with funds which reflect your values. Invest in the trends you believe in, including specific sectors and regions, or responsible investments.
Shares – own a portion of a big-name brand by investing directly in a UK or US company.

You can browse the investment range on the website to view your options in more detail.

How do I invest?

First you need to choose:

What you want to invest in? Dodl offers a streamlined range of funds, themes and shares to keep things straightforward.
How much you want to invest? If you invest in shares, it'll need to be enough to buy at least one (Dodl doesn't offer fractional shares).
How often you want to invest? You can invest on a one-off basis or automate your investing journey with monthly investments.

Choices made, you're ready to place your order in the app. As you're doing this, read and make sure you're completely happy with your investment details, including all charges. And if you're investing in US shares for the first time, you'll also need to complete a W-8BEN form. Then you're all set to go ahead and submit your order.

Once you’ve submitted your order, Dodl will handle the rest. Orders are processed once a working day and the daily cut-off time for submitting them is usually 3pm. If your order's submitted after this, it'll be processed the next working day.

After your investment has gone through, a contract note (like an order receipt) is sent to your account. Shares will usually arrive in your account shortly after this, but funds can take a little longer – usually around 2-3 working days later.

How are the investments in my Lifetime ISA protected from tax?

They’re protected from UK capital gains and income tax. This means that any growth in the value of your investments won’t be taxed and any income they make (also called ‘dividends’) won’t be taxed either. But do keep an eye on tax and ISA rules, as these could change in future.

How do I get a valuation of my Lifetime ISA?

Just log in and view your Lifetime ISA. You’ll be able to see how each investment in your portfolio is doing and the overall value of it. You’ll also get quarterly statements for your Lifetime ISA in the documents area of your app.

Withdrawing cash from your Dodl investment Lifetime ISA

When can I withdraw cash from my Lifetime ISA?

You can withdraw cash from your Lifetime ISA anytime. But because Lifetime ISAs are designed specifically to help you save for your first home (up to £450,000) or retirement after 60, if you take money out for any other reason, you’ll have to pay the 25% government withdrawal charge on the amount you withdraw. The withdrawal charge won’t apply if you’re terminally ill (if you need more info on this, please chat to the team in the app or at hello@dodl.co.uk).

Once you’ve withdrawn cash from your Lifetime ISA, it can only be paid back in if you haven’t paid into a different Lifetime ISA in the same tax year. You’ll also only be able to pay cash back into your Lifetime ISA if you have enough Lifetime ISA allowance and ISA allowance left.

How do charge-free withdrawals for a house purchase work?

Before you can make a charge-free withdrawal from your Lifetime ISA to buy your first home, you’ll need to meet all the following conditions:

the house you’re buying is your first home
the purchase price of the house isn’t more than £450,000
you’ll occupy the house as your only or main residence, or you’re a Crown employee (or the spouse or civil partner of someone who is) currently working abroad with a longer-term goal to live in the property
you’re paying for some of the house with a mortgage
you’ve paid into your Lifetime ISA for at least 12 months

If you don’t meet one or more of these conditions and choose to withdraw cash from your Lifetime ISA, then the 25% government withdrawal charge will apply. The government’s Lifetime ISA campaign can help with any more details you need on this.

Assuming you qualify as a first-time buyer, the first thing to do is contact your solicitor or conveyancer (whoever’s handling the legal side of your house purchase). They'll ask you to complete a declaration to confirm you’re a first-time buyer, and they'll also complete their own declaration.

They’ll then need to send the completed declarations to Dodl. If they're valid, your cash will be sent directly to your solicitor/conveyancer for your house deposit. It may take up to 10 working days for this bank transfer to complete, so make sure you allow enough time.

Once the payment’s been made, if you don’t complete your house purchase within 90 days the cash will need to be returned to your Lifetime ISA.

How does the government withdrawal charge work?

Where the withdrawal charge applies, 25% of the amount you take out will be paid back to the government and the rest is paid to your bank account – Dodl will arrange all of this. It means you’ll likely get back less than you paid into your Lifetime ISA.

What happens to my Lifetime ISA if I die?

If you’ve made any payments to your Lifetime ISA before death and the 25% government bonus hasn’t yet been claimed, Dodl will arrange for this. The team will be in touch with those dealing with your estate about the sale of any investments.

No more payments can be made into your Lifetime ISA after your death, but it’ll keep its tax benefits - any interest, dividends or growth on investments after the date of death will continue to be tax free – until the first of the following events happens:

the Lifetime ISA is closed
the administration of your estate is completed
three years after your death

Your Lifetime ISA will then be paid out according to instructions from the people dealing with your estate.

The 25% government withdrawal charge doesn’t apply if your Lifetime ISA is withdrawn and closed following your death – but its value will form part of your estate so will be subject to inheritance tax.

Important notes

The information in this key features document is provided based on our understanding of current law, practice and taxation which may be subject to change.

Full details of the legally binding contract between you and Dodl are included in the Dodl terms and conditions, which can be viewed from the Dodl app or website anytime.

The law of England and Wales will apply in all legal disputes.

If you’d like a copy of this or any other document in large print, Braille or in audio format, the team will be happy to arrange this for you. Just contact them in the app or via email at hello@dodl.co.uk.

All Dodl documents and any future communication to you will be in English.