The Help to Buy ISA closed to new savers in November 2019, but around a million accounts remain open and the terms still apply: the government adds 25% to the savings when the holder buys a first home, at least £400 on £1,600 and at most £3,000 on £12,000. Savers can keep paying in up to £200 a month until 30 November 2029 and must claim the bonus by 1 December 2030. The home must cost no more than £250,000, or £450,000 in London, and the bonus is paid to the solicitor at completion rather than towards the deposit at exchange. Anyone with an account and a purchase in sight should check the price cap first, because it has not risen since 2015.
The rules
| Help to Buy ISA | |
|---|---|
| Bonus | 25% of the closing balance, minimum £400 on £1,600, maximum £3,000 on £12,000 |
| Paying in | Up to £200 a month; no new accounts since 30 November 2019 |
| Last date to pay in | 30 November 2029 |
| Deadline to claim the bonus | 1 December 2030 |
| Property price cap | £250,000 outside London, £450,000 in London boroughs |
| Who can use it | First-time buyers, each buyer with their own account and bonus |
| Interest | Tax free, at the provider’s rate; the balance counts within the ISA allowance |
The bonus is claimed by the conveyancing solicitor after exchange and paid at completion, so it cannot form part of the deposit paid at exchange, which caught early users out. Two first-time buyers purchasing together can each claim on their own account, up to £6,000 between them. The Help to Buy ISA calculator shows the bonus on any balance and checks the price cap for the area.
Where the price cap bites
The £250,000 cap outside London has not changed since the scheme opened, while the average first-time buyer price in England has risen well beyond it in the south and midlands. A buyer whose home costs £260,000 loses the entire bonus; the balance and interest are still theirs, but the government contribution is not paid. Buyers near the limit have two options: keep the purchase price within the cap, with fixtures and fittings paid separately where a seller agrees, or transfer the money to a Lifetime ISA, whose £450,000 cap applies everywhere.
Help to Buy ISA or Lifetime ISA
| Help to Buy ISA | Lifetime ISA | |
|---|---|---|
| Bonus | 25%, maximum £3,000 in total | 25%, up to £1,000 a year with no lifetime maximum |
| Paying in | £200 a month | £4,000 a year |
| Price cap | £250,000, £450,000 in London | £450,000 everywhere |
| Bonus paid | At completion, via the solicitor | Monthly into the account, usable at exchange |
| Other uses | None; withdraw the savings without bonus | Retirement from 60; other withdrawals carry a 25% charge |
| Age | Any adult first-time buyer | Open between 18 and 39; pay in until 50 |
For most people still saving, the Lifetime ISA is the better vehicle: it takes £4,000 a year rather than £2,400, pays the bonus as you go, applies the higher price cap nationally and the bonus can be used at exchange. Money can be transferred from a Help to Buy ISA into a Lifetime ISA, counting towards that year’s £4,000 limit, and the Lifetime ISA must have been open for twelve months before it is used for a purchase, so the transfer needs to happen at least a year before buying. Only one of the two bonuses can be used on a single purchase. The Lifetime ISA calculator plans the contributions and bonus, and our ISA allowance guide explains how both fit inside the £20,000 annual limit.
Claiming the bonus
Once a purchase is agreed the saver closes the account and obtains a closing letter from the provider, which the solicitor uses to apply for the bonus through the scheme administrator; the money arrives before completion and the solicitor applies it to the purchase price. The claim must be made within twelve months of closing the account, and the property must be the buyer’s only home, bought with a mortgage rather than cash, and in the UK. If a purchase falls through after the account is closed, the money can be reopened into a Help to Buy ISA within twelve months without losing the right to a bonus. Our first-time buyer deposit guide covers how the bonus fits with the deposit, stamp duty relief and other costs.
Common questions
Can I still open a Help to Buy ISA? No. The scheme closed to new savers on 30 November 2019. Existing holders can keep saving until 30 November 2029 and claim the bonus until 1 December 2030.
How much is the bonus? 25% of the balance when the account is closed for a purchase, between £400 on £1,600 and £3,000 on £12,000.
What is the property price limit? £250,000 outside London and £450,000 in London. A home above the limit receives no bonus at all.
When is the bonus paid? At completion, through your solicitor, after the account is closed. It cannot be used for the deposit at exchange.
Should I move my Help to Buy ISA to a Lifetime ISA? Usually yes if you are under 40 and at least a year from buying: the Lifetime ISA takes more each year, pays the bonus as you go and has a £450,000 cap everywhere. Only one bonus can be used per purchase.
Can two buyers both claim? Yes. Each first-time buyer with their own account can claim their own bonus on the same home, within the price cap.
Information, not financial advice. Scheme terms are those published by HM Treasury for the Help to Buy ISA and the Lifetime ISA rules on gov.uk: Lifetime ISA; figures are from the site’s calculators. Check the price cap for your area and your provider’s closing procedure before agreeing a purchase.