Quick Guide: Help To Buy ISA
Are you trying to save for your first home? Then a Help To Buy ISA (HTB ISA) may help you get a 25% bonus from the Government towards the cost.
Help To Buy ISAs will only be available to new savers until 30 November 2019. If you open an ISA before the deadline then you can continue to save into it until 30 November 2029. Your bonus must be claimed by 1 December 2030.
- You must be a first time buyer and not own, nor have ever owned, a property anywhere in the world.
- You have to be a UK resident with a valid National Insurance number.
- You must be aged 16 or over.
- You can't have another active cash ISA in the same tax year. You can transfer up to £1,200 of an active cash ISA to a Help To Buy ISA. If you have more than £1,200 in a cash ISA then the balance must be moved into a non-cash ISA or non-ISA account.
Opening your HTB ISA
- You can open a Help To Buy ISA with any provider that is offering them. You can't open a new one each year but you can transfer it between providers.
Saving in your HTB ISA
- You can save a maximum of £200 per month into your ISA. In the first month you are allowed to save an additional £1,000.
- You don't have to save the same amount every month, but you can't skip a month and pay £400 the next month, the maximum in any month is £200. The £200 allowance is based on calendar months.
- You don't have to pay in £200 in one go, you could pay in 4 lots of £50 during the month.
- You can take money out of your ISA whenever you like, but this doesn't change your allowance. If you have paid in £200 in January and withdrawn £100 in January, you will have to wait until February until you can pay anything more in.
What bonus will you get?
- The Government will boost your savings by 25%, up to a maximum of £3,000. You would have to save £12,000 to qualify for the maximum bonus. You can save more than £12,000 in your ISA but you will only get the maximum bonus of £3,000.
- You must have saved at least £1,600 of your own money before you can claim the minimum Government bonus of £400.
- If you plan to buy a property at £250,000 with a 10% deposit then you will need £25,000 in total; you will need to save £22,000 and claim the £3,000 bonus. That means the Government will contribute 12% of your deposit!
Claiming your bonus
- You will need to instruct your solicitor or conveyancer to claim your bonus which is usually paid between exchange of contracts and completion.
- If you want to use your ISA money as your deposit to exchange contracts, don't withdraw the money until you have requested a closing statement from the provider or you will lose entitlement to your bonus. The closing statement is needed by your solicitor to claim your bonus.
- You only have 12 months from closing your ISA to claim the bonus so don't close it unless you are sure the purchase is definitely going ahead. Your ISA can be reinstated if a property purchase falls through for genuine reasons.
- Your solicitor will normally ask you to pay them 10% of the purchase price of the property in order to exchange contracts. If you need the bonus to contribute to this 10% then speak with your solicitor to discuss the options.
What can you use your HTB ISA for?
- You can use your savings to buy land to build on, or a property (including new build) subject to the following conditions.
- The property or land you are buying must:
- be in the UK;
- have a purchase price of up to £250,000 (£450,000 in London);
- be the only home you will own;
- be where you intend to live, you can't rent out the property;
- be purchased with a mortgage.
This is just a brief overview of the scheme and does not constitute a recommendation.
You can find out more at
Maxwell Moore is not responsible for the content of external websites.
If you are interested in finding out more, or are considering buying with a Help To Buy ISA then get in touch with us and we'll be happy to help.