Help to Buy ISA Explained
Help to Buy ISA (Individual Savings Account) are a new type of ISA designed to help first-time buyers save up a deposit for their home. We break down how to benefit from the scheme and tell you how Profit Squirrel is helping thousands of people unlock a further £6,000 tax-free income each year.
As you may already know, the help-to-buy ISA is a government initiative where they will add 25% to your savings, up to a maximum of £3,000 on £12,000 saved.
So, for every £200 you save, you receive a government bonus of £50. The maximum government bonus you can receive is £3,000.
Steps to opening an ISA
1. Open: ISA will be available from a range of banks and building societies.The accounts are available to each first-time buyer, not each household. This means that if you are planning to buy with your partner, for example, you could receive a government bonus of up to £6,000 towards your first home.
2. Save: To kick-start your account, in your first month, you can deposit a lump sum of up to £1,200.The minimum government bonus is £400, meaning that you need to have saved at least £1,600 into your Help to Buy: ISA before you can claim your bonus. The maximum government bonus you can receive is £3,000 – to receive that, you need to have saved £12,000.
3. Receive bonus: When you buy your first home, your solicitor or conveyancer will apply for your government bonus. Once they receive the government bonus, it will be added to the money you are putting towards your first home.
Who is eligible?
To qualify for a Help to Buy: ISA you must:
- be 16 or over
- have a valid National Insurance number
- be a UK resident
- be a first-time buyer, and not own a property anywhere in the world
- not have another active cash ISA in the same tax year: If you have opened a cash ISA this tax year, you can open a Help to Buy: ISA but will have to take additional steps.
To qualify for the government bonus, the property you are buying must:
- be in the UK
- cost up to £250,000, or up to £450,000 if you are buying in London
- not be a second home or a buy-to-let property
- not be rented out after you buy it
- be purchased with a mortgage
Boost your income by £6,000 tax-free
The new help-to-buy ISA scheme is a great initiative to help first-time buyers but it’s still very dependent you on you having enough saved. Thousands of peoples are turning to Profit Squirrel to earn a second income online, generating an extra £500+ per month – that’s £6,000 per year per person. If you and a partner joined that’s an additional £12,000 per year just from Profit squirrel.
Profit Squirrel will show you how to earn a second income with ease. When you add Profit Squirrel with the latest ISA initiative, your chances of owning a house is significantly improved.
Here’s just how significant Profit Squirrel can be for you alongside saving for the Help to Buy ISA.
Boost your chances of finally owning a home – Join Profit Squirrel for free today.