Help to Buy ISA
The Help to Buy ISA scheme was introduced by the government to help first time buyers save a big enough deposit to get onto the property ladder.
Although a new Help to Buy ISA cannot now be opened, you can still keep adding to it and claim the bonus until December 2030.
The scheme works by topping up the amount saved in the ISA by 25%, up to a maximum of £3,000.00. Essentially, for every £200 saved in the account the government will add £50 by way of a bonus claimed when an individual buys a property. The account providers, which are most high street Banks or Building Societies, also offer interest on the amount tax free.
The money can be taken out at any stage even if you do not buy a property, you just wouldn’t benefit from the 25% bonus from the government.
The Help to Buy ISA is an individual product meaning that those who buy a property together can benefit from having two or more ISA bonuses towards the property. Savers can put in a maximum of £200 per month but you don’t have to save each month if you don’t want to – as long as there is a minimum of £1,600 in the account when you want to claim the bonus.
The Lifetime ISA (LISA) scheme continues to run so even if you do not currently have a Help to Buy ISA, you can benefit from the LISA which operates in a similar way.
For more information contact our Property team