Although the Help to Buy ISA may have closed, its legacy has been enjoyed by more than 17,500 first-time buyers, who have enjoyed over £35 million in bonuses this year.
During its lifespan, the ISA has paid out 650,000 bonuses worth £750 million, which has helped first-time buyers to purchase 497,949 properties worth £87.7 billion in total.
Launched in 2015, the Help to Buy ISA has been available through banks, building societies and credit unions, offering savers a 25 per cent top-up on their savings each year, provided as a bonus by the Government during a sale.
Although the scheme is not open for new applications, you can continue paying into the ISA until November 2029 and can claim the 25 per cent bonus until November 2030.
This ISA has since been replaced by the Lifetime ISA (LISA). You can use a LISA to save for later life or buy your first home.
To open an account, you must be over the age of 18 but under the age of 40. You can continue paying into a LISA until the age of 50.
A maximum of £4,000 a year can be deposited into your account, on which you will earn a 25 per cent bonus on your savings, up to a maximum of £1,000 per year. This counts towards your total £20,000 tax-free ISA limit.
You can only withdraw money from your ISA and benefit from the bonus if you are:
- Buying your first home
- Aged 60 or over
- Terminally ill, with less than 12 months to live
If you access your savings before then you will have to pay a withdrawal charge of 25 per cent.
