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Help to Buy: ISA

The Help to Buy ISA is a tax-free savings scheme, designed to help first time buyers save up enough money for a deposit on their first home.

With the scheme, which will run until autumn 2019, the government will contribute an extra 25% on top of your savings. You can save a maximum of £200 per month, as well as an initial £1,000 deposit. So, in the first month, you could save £1,200 on top of which the government will add an extra £300.

If you pay in the maximum £1,000 deposit as well as £200 every month until you reach £12,000, you’ll get a bonus of £3,000 – which gives you an overall total of £15,000. You can claim the bonus as soon as you’ve saved £1,600, which would mean a £400 bonus.

You can open a Help to Buy ISA with a bank or building society, just like a normal cash ISA. Once you’ve opened an ISA, you can pay into it for as long as you like, and there are no limits on when you can use your bonus.

Who is eligible for a Help to Buy ISA?

If you’re a first time buyer, you can open up a Help to Buy ISA, as long as you’re over 16, even if you’re buying a property with someone who isn’t a first time buyer. You can’t get a first time buyer ISA if you plan to rent out the property, or if you’ve previously owned or inherited a property in the UK or abroad.

You can’t have a Help to Buy ISA and a regular cash ISA in the same tax year. If you’ve opened up a new cash ISA (or paid into an existing one) in the current tax year, you won’t be able to open a savings account as a first time buyer until the new tax year.

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Help to Buy ISA FAQ

Here are some of the most commonly asked questions about Help to Buy ISAs: