Help to Buy ISAs

Now closed for newbies – need-to-knows if you've already got one

Help to Buy ISAs are now closed to new applicants. Didn't get one in time? Lifetime ISAs also offer a 25% bonus for first-time buyers. But if you do have a Help to Buy ISA, here's everything you need to know, including how to claim the 25% bonus, whether it's worth transferring to a Lifetime ISA and how to get a better rate by changing provider.

Other top ISA and mortgage guides...

Lifetime ISA: The Help to Buy ISA's successor scheme
Cash ISAs: The top-paying cash ISAs.
Mortgages for first-time buyers: Free downloadable booklet. 
Boost your credit score: Tips to boost your creditworthiness.

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What is a Help to Buy ISA?

Help to Buy ISAs are no longer open to new applicants. But, if you already have one, they let you save up to £200 a month towards your first home, with the state adding a 25% bonus (max £3,000) on top of what you save. Plus you earn interest on whatever you save, and as it's an ISA, that interest is tax-free.

However, you only get the bonus when you use the Help to Buy ISA cash as a deposit for your first home. The way is works is a bit complex, so do read our need-to-knows if you're getting close to using your Help to Buy ISA savings to buy a property. 

The 12 Help to Buy ISA need-to-knows

Here's our full info on how to use your Help to Buy ISA for a home, and whether it's worth transferring it to a Lifetime ISA. 

  1. You can keep saving up to £200/mth until 30 November 2029

    You can save up to £200 a month in your Help to Buy ISA. If you've got less, you can put in less each month. If you miss a contribution one month, it's not a problem, though you can't make it up the next month (ie, you can still only put in £200 the next month).

    The deadline to open a Help to Buy ISA has now passed. But if you've already got one, you can keep saving in it until 30 November 2029. You’ll then have until 1 December 2030 to claim the 25% state bonus.

    Are my savings safe in a Help to Buy ISA?

    As Help to Buy ISAs are savings accounts, there is no investment risk. The only risk is the slight one of the bank or building society going bust. Yet all the providers we include have the full UK £85,000 safe savings protection and Help to Buy ISAs are covered by that.

    The only thing to watch is that this is by banking institution, not per account. So if you have other savings in the same banking institution (for more on what this means, see our Savings Safety guide) as your Help to Buy ISA savings, it could take you over the limit, particularly if you have a large deposit.

  2. The state adds 25% tax free to whatever is in the ISA when you use it to buy a home, up to a max £3,000 bonus

    Even with the personal savings allowance, if you're a first-time buyer, saving for a deposit in a Help to Buy ISA (or Lifetime ISA) before thinking about any other accounts is a no-brainer.

    At the point you use your Help to Buy ISA savings towards buying your first home, all the cash you've saved, and the interest, will have 25% added to it, with two exceptions:

    • You need to have at least £1,600 saved to get any bonus (so you'd get £400 extra).
    • The most you'll get the bonus on is £12,000 (so a £3,000 bonus). If you have more than that you can still use the ISA to save, you just won't get more than £3,000 on top.

    How much state top-up you'll get

    AMOUNT IN HELP TO BUY ISA BONUS ADDED
    £1,600 (the minimum to get bonus) £400
    £3,000 £750
    £5,000 £1,250
    £8,000 £2,000
    £10,000 £2,500
    £12,000 £3,000

    The bonus scheme's set to keep paying out on Help to Buy ISA savings until 1 December 2030. So you could put in just a small amount a month and take years to build up your bonus. However, you risk a future Government changing the rules before 2030, meaning it'll stop paying bonuses.

  3. Buying with another first-time buyer? You can join bonuses

    If you've got a Help to Buy ISA and you're buying with someone else who also has one, you can save up to £400 a month across your two Help to Buy ISAs and, when you come to buy, double the bonus.

    Similarly, if the person you're buying with has a Lifetime ISA, you can both get the bonuses when you buy.

  4. The Help to Buy ISA can be used for any property costing £250,000 or under (£450,000 in London)

    The bonus will only be available on homes you buy for £250,000 or less, or £450,000 in London (defined as inner and outer London boroughs). Unlike some other Government schemes, you're not restricted to buying a new build; any property works – provided you're buying with a mortgage (you won't get the bonus if you're a cash buyer).

    • You can use it with any mortgage type, it DOESN'T have to be used with a Help to Buy equity loan (though it can be), but it must be a residential mortgage, including self-build and shared ownership, NOT buy-to-let.
    • Do note, though, with shared ownership, you'll only get the bonus if the total property price is £250,000 or under (£450,000 in London) – it's not based on the price of the proportion you're buying.
    • The property price limit is absolute – it doesn't double if you're buying with another Help to Buy ISA holder.
    • It doesn't need to be your sole deposit money, you can combine it with other savings (see where to save the rest).
    • You don't need to get a mortgage from your Help to Buy ISA provider. Always check the whole mortgage market before you choose one. Our Mortgage Comparison tool can help and get the Free First-Time Buyers' Mortgage Guide guide too.
    • You don't need to be named on the mortgage to use your bonus, though you must be on the title deed of the property you're buying – and some lenders may require everyone named on the title deed to be named on the mortgage too.
  5. The Help to Buy ISA bonus only helps with the mortgage deposit, not the deposit you send to the buyer at exchange

    When you buy a home there are two types of deposit (though the same money's generally used for both). And, as the Government decided you'd only get the Help to Buy ISA bonus at completion (so no one could get it if they pulled out of a property sale), it only helps you with one of these types, and it's important to understand the difference.

    • The home exchange deposit: During the process of buying a property, after your offer is accepted, once you've checked everything out you normally exchange contracts with the seller. At this point the seller will usually ask you to put down a 10% deposit (sometimes it can be negotiated lower to 5%) to secure the property. After that no one else can trump you as you and the vendor are committed to the sale.

      You then have time to work through your finances and any other issues towards completion, which is when you and the mortgage company hand over the remainder of the cash (see Buying a Home Timeline for more).

      While you can use the money you've saved in a Help to Buy ISA towards this exchange, it's only at completion that you receive the mortgage money and Help to Buy ISA bonus – so the bonus won't help towards the home exchange deposit.

      So if you're relying on the Help to Buy ISA bonus to get you to 10% (or indeed only have a 5% deposit in total), it could be a problem. However, in most cases, it'll be worth trying to negotiate with the seller (probably via your solicitor) on this.

      Be honest with them about the Help to Buy ISA bonus. If the seller wants the sale to go through, they could agree to a lower deposit (possibly with the right to chase you in court for the full 10% if you later pull out).

      But according to brokers we've spoken to, as long as you are upfront about your reliance on the Help to Buy ISA bonus, it shouldn't be a major issue. Most vendors are unlikely to pull out of a sale because of a small shortfall which will be made good in just a matter of days when you finally complete.

    • The deposit at completion (sometimes called the mortgage deposit): It is this final deposit when you actually become the legal property owner – not the specific exchange deposit described above – which the Help to Buy ISA bonus is for.

      Say you're buying a £100,000 property, and have saved £8,000 in a Help to Buy ISA; with the bonus you'll have £10,000, so a 10% deposit in total. You’d have been able to use your £8,000 at the exchange stage but can only get the additional £2,000 at this point of completion. That helps to reduce the amount you need to borrow and cuts the cost of your mortgage rate too.

  6. You need to get your solicitor to apply for the bonus when you buy a home

    When you're ready to buy, to get the bonus, you let your ISA provider know that you're closing down your Help to Buy ISA account, and transfer the funds into another account (or your solicitor's account). You'll then receive a closing letter from your ISA provider, which you need to give to the solicitor who is doing your conveyancing (house-buying) work for you.

    The solicitor then uses the letter to apply online for the Government bonus, between the stages of exchanging and completing on your home purchase. Beware! Because it's admin work, and takes time, solicitors are allowed to charge up to a maximum of £60 (£50 + VAT).

  7. You can rent out your property if you've used a Help to Buy ISA as part of the deposit

    When you use a Help to Buy ISA to buy a home, you sign a declaration saying that you won't rent the property out – the Government's idea is to encourage homeownership, not help people start burgeoning property empires.

    But this was such a restriction, we queried it with the Treasury – what happens if people's circumstances change? For example, if you had a job abroad for a couple of years, but wanted to keep the home and move back in when you came back to the UK – would you have to sell the property?

    The Government saw the sense in the question, and has now partly relented... you will be able to rent your property out if your circumstances change down the line.

    However, if you're buying the property with the sole intention of renting it out, this still isn't allowed. If you're caught, the Government would seek to get its bonus money back from you.

    Read full details of our challenge to the Treasury in Martin's Can I rent out my home if I used a Help to Buy ISA? blog.

  8. You can transfer your Help to Buy ISA to a different provider to up the rate

    Though many providers have now withdrawn their Help to Buy ISAs from the market, a few still allow transfers in for those who already have one. 

    Therefore it's important to check the rate you're getting from your provider to see if you can do better elsewhere. The top paying accounts are below. 

    Note: you'll need to ask the new provider to transfer your existing account when you open the new one – don't take the money out yourself.

  9. You can pay in to other cash ISAs in the same year as you've paid in to a Help to Buy ISA

    Following some changes to the ISA rules in April 2024, you can now pay into multiple cash ISAs in the same tax year. This is useful if you have a Help to Buy ISA as it counts as a cash ISA. 

    Just remember, your maximum ISA allowance per tax year is £20,000 so you can't put more than this into ISAs in the same tax year. 

  10. It could be worth transferring your Help to Buy ISA to a Lifetime ISA if you won't be buying for a year or more

    Like the Help to Buy ISA, the Lifetime ISA (LISA) also has a 25% bonus if you use the savings towards a first home. If you're aged 18 to 39, you can open a LISA in addition to your Help to Buy ISA, however you can only use the bonus from one of them towards buying a home.

    So, unless you want to use the LISA and its bonus for retirement savings, the main decision is whether or not to keep the Help to Buy ISA, or transfer it to a LISA. See Martin's Should I move my Help to Buy ISA into a Lifetime ISA?, or read on for a summary.

    For simplicity, there are three main benefits of using a LISA over a Help to Buy ISA:

    • You can save up to £4,000/year in a LISA, versus £2,400/year in a Help to Buy ISA. So you'll be able to save and earn the bonus quicker with a LISA. 

    • You'll earn a larger bonus if you're able to save over £12,000. The maximum bonus you can get with a Help to Buy is £3,000 (so £12,000 saved) whereas the LISA doesn't have this cap (the maximum bonus is £33,000 if you saved £4,000/year from age 18 to 49). 

    • You can buy a home up to £450,000 anywhere in the UK. The Help to Buy ISA can be used for a property costing up to £250,000, or £450,000 in London. The LISA has a flat £450,000 anywhere.

    But there are also three potential drawbacks to making the switch from your Help to Buy ISA: 

    • A LISA has to be open at least a year to use it for a first home. So if you've not yet opened one and know you'll buy within a year, stick where you are.

    • You'll pay a penalty to withdraw cash from a LISA, unless used for your first home or retirement. Unlike the Help to Buy ISA, where you can withdraw your cash whenever you like (without the bonus), the LISA charges a penalty of 25%, so you'll lose around 6% of what you've put in. So if you're not sure you'll buy at all, a H2B ISA is safer.  

    • If you have more than £4,000 saved in a H2B ISA, you'll need to wait until a new tax year(s) to transfer it all. Money you transfer from a Help to Buy ISA to a LISA still counts towards the £4,000 LISA allowance each tax year, so if you've more than that saved, you'll need to wait until after 6 April (that is, the start of the next tax year) to move another £4,000. 

      For example, if you had £12,000 saved in a Help to Buy ISA, it would take you three tax years to move it all to a LISA (so at least a year and two days), for you to be back in the same position as you are now. 

      This timing is important as, if you decide to buy whilst you've got cash in both, you'll essentially be sacrificing the bonus on one pot of money. So if you're going to transfer, make sure you have ample time before you're planning to buy to move your cash. If you don't, again, it's best to stick with the Help to Buy ISA.  
    • See our full LISA vs Help to Buy ISA comparison

      Lifetime ISAs vs Help to Buy ISAs – which wins?

      TABLE_CELL_STYLE LIFETIME ISA (FOR HOME PURCHASE) HELP TO BUY ISA
      Max contribution? £4,000/year £2,400/year (£3,400 in year one)
      Lump sums? Yes No, need to save monthly
      Max bonus? £33,000 (assumes max contribution every year from age 18-49) £3,000 (assumes max contribution over four years and eight months)
      When's the bonus paid? Monthly On completion when you buy a home
      Investment option too? Yes, via stocks & shares LISAs No. Cash savings only
      Max property price? £450,000 £250,000 (£450,000 in London)
      How quickly can you use it? After the LISA's been open 12mths Once you've £1,600+ saved (can be done in min 3mths)
      Who can open it? Anyone aged 18 to 39 No one - they're closed to new applicants
      What can it be used for? The home deposit and mortgage deposit Just the mortgage deposit
      Can I withdraw money if not buying a home? Yes, at age 60+; if earlier you don't get the bonus and will pay a penalty Yes, at any time, you just don't get the bonus

    How to transfer your Help to Buy ISA savings into a Lifetime ISA

    If a LISA wins for you, you just need to open one (see the top payers) and move the money across. You can only transfer up to £4,000 this tax year (less if you've already paid in to the LISA) as any money transferred from a Help to Buy ISA to a LISA counts towards the allowance. Here's how to transfer the money:

    • If the LISA provider allows transfers from a Help to Buy ISA, fill in its transfer form as you apply. This then won't reduce your overall £20,000 ISA limit. The transfer should take two to four weeks.

    • If it doesn't accept transfers, you'll have to just withdraw the money. You should be able to find a top payer that accepts transfers in, but if you can't or want to go with a provider that doesn't, you'll have to just withdraw the cash from the Help to Buy ISA and pay it in to the LISA.

      This will mean your overall £20,000 ISA limit is reduced for the tax-year in which you make the deposit, though if you're unlikely to use this anyway, it's not a huge deal. 

    If you have more than £4,000 in your H2B ISA, you'll need to move £4,000 now and then ask to transfer the rest when the next tax year starts. Some Help to Buy ISA providers may close your account when you transfer some of the money out, in which case you'll need to close it down, take the money out and save it elsewhere (see top savings) until you can put it in a LISA.

  11. If you've filled your Help to Buy ISA, use other accounts for additional savings

    This point isn't really about Help to Buy ISAs but, if you've got a lump sum, or you're saving over £200/mth (£400/mth if a couple of first-timers buying together), you'll need to save elsewhere too.

    Quite simply, you want to put your cash in the account paying the highest after-tax interest. The personal savings allowance means basic-rate taxpayers can earn £1,000 interest a year without tax, higher rate £500, so for most people tax is no longer such a big issue on where you save. 

    See Top Savings Accounts for the best rates currently available. 

  12. You can take the money out whenever you want, even if you're not buying a property - but you won't get the bonus

    If you decide not to buy your first home (or to buy one costing more than the qualifying amount) you won't lose the money in your Help to Buy ISA. You can take cash out whenever you want – you just miss out on the bonus. It'll still be tax-free and you'll still get the interest you're due.

    The rules also allow you to make partial withdrawals, while keeping the Help to Buy ISA open (though withdrawal rules will depend on your provider). You won't be eligible for the bonus on the amount withdrawn, but you can still keep contributing afterwards and will still get the bonus on whatever is in the account when you use it for a deposit.

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Top picks: Help to Buy ISAs for transfers

Since Help to Buy ISAs closed to new applicants in 2019, options have become more limited and rates have dropped. If you've already got a Help to Buy ISA, check the rate you're getting against the accounts below to see if you could earn more by switching providers.

It’s also worth considering transferring to a Lifetime ISA, which lets you save a much bigger amount and could mean a bigger bonus (see Help to Buy ISAs vs Lifetime ISAs).

Note: if you get a provider's Help to Buy ISA, you don't then need to get its mortgage (for example, if you have a Halifax Help to Buy ISA, you're NOT tied in to getting a Halifax mortgage).

Top Help to Buy ISAs

Provider Rate (AER variable) How to transfer How to manage Interest paid
HSBC

Existing customers with a current account, Flexible Saver or Premier Savings only
3.5% up to £12,000

(2% above)
Complete a transfer form and take it to a branch or post it Online/ app/ phone/ branch Monthly
Halifax 2.9% up to £12,000

(1.45% above)
Call Halifax to start transfer Online/ app/ phone/ branch Annually
Bank of Scotland 2.9% up to £12,000

(1.45% above)
Call Bank of Scotland to start transfer Online/ app/ phone/ branch Annually
Lloyds Bank 2.9% up to £12,000

(1.4% above)
Call Lloyds Bank to start transfer Online/ app/ phone/ branch Annually

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