Help to Buy: ISA

To help first time buyers get on to the housing ladder, the government introduced a form of ISA called the Help to Buy: ISA. It had all the tax advantages of a cash ISA but is also topped up by the government by up to an additional £3,000. It was designed to help first time buyers save enough to put down a deposit for their first home.

The Help to Buy: ISA was available through banks and building societies. First time buyers that save through a Help to Buy: ISA received a government bonus to help encourage them to save.

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How does it work?

The saver opened up a Help to Buy: ISA at a bank or building society. They needed to be over 16, have their National Insurance No. and be a first time buyer. You could only open one Help to Buy: ISA and the saver invests a maximum of £200 per month into the Help to Buy: ISA. The government will increase this by 25% when the saver buys their first house.

The maximum amount that can be saved under the Help to Buy: ISA is £12,000. The government will top this up by 25% of the amount saved, to a maximum of £3,000 to bring the total saved to £15,000.

help to buy isa graph grey

The bonus is paid when the saver commits to buying a property as their main residence (not buy to let). The bonus is subject to a minimum claim of £400 (requiring a minimum of £1,600 of savings).

The amount saved can help pay the deposit on a house up to the value of £250k outside London and £450k in London.

Help to Buy: ISA accounts were limited to one per person not one per household, so a couple could put two Help to Buy: ISAs together to buy a home.

The Help to Buy ISA closed to new accounts at midnight on 30 November 2019. Where you had already opened a Help to Buy ISA (or did so before 30 November 2019), you were able to continue saving into your account until November 2029.

*For further information see https://www.gov.uk/government/publications/help-to-buy-isa
Contains public sector information licensed under the Open Government Licence v3.0.

 

 

Also See:

NISAs (ISAs) Junior ISA

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