Help to Buy ISAs Ending
The Help to Buy ISA scheme introduced by the government in 2015 is coming to an end – act now if you want to open up an account!
The scheme was introduced by the government to help first time buyers save a big enough deposit to get on the property ladder and 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 scheme is being stopped on the 30th November 2019 but as long as the account is opened by then you can still keep adding to it and claim the bonus up until December 2030. So even if you are not looking to buy a property at the moment, it could be worth opening up an account as you have 11 years to claim the bonus. 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. You must be 16 to open a Help to Buy ISA and can open the account with as little as £1. 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 will still be running, so if you do miss out on the Help to Buy ISA deadline you can benefit from the LISA which operates in a similar way.
For more information contact our Property team