Help to Buy ISA end date is fast approaching
HELP TO BUY ISAS are currently available for new savers to open, however the deadline for doing this is looming. What will happen to savings in a Help to Buy ISA after this date?
The Help to Buy ISA scheme is a type of ISA which sees account holders able to benefit from a government bonus of 25%. The maximum amount a person can receive in this scheme is £3,000. The Help to Buy ISA is designed for those looking to get on the property ladder. However, prospective first-time buyers interested in opening this type of account have until 30 November 2019 to do so.
If a person already has a Help to Buy ISA on this date, they may wonder what will happen to their savings – as well as the 25% government bonus they’re hoping for.
The government’s Help to Buy website explains that if an account was already open, then the individual can keep saving into the account until 30 November 2029.
At this point, the accounts will close to additional contributions.
The bonus must then be claimed by 1st December 2030.
The purchase needs to cost £250,000 or less (or £450,000 or less in London) in order to get the 25% bonus.
In the first month, a person can put in up to £1,200 into this type of account.
Then, subsequent payments into this account are limited to up to £200 per month.
Another type of ISA which sees the government boost savings by 25% is a Lifetime ISA.
The maximum amount of contributions a saver can make to this account each tax year is £4,000.
Savers can get up to £1,000 as a government bonus per year.
Some people may wonder whether they can have a cash ISA and a Lifetime ISA at the same time.
There are four types of ISA, and these are cash ISAs, stocks and shares ISAs, innovative finance ISAs, and Lifetime ISAs.
It’s possible to put money into one of each kind of ISA each tax year.
The maximum amount which can be saved in ISAs in the 2019 to 2020 tax year is £20,000.