Help to buy ISA confusion

Plus

Archi_Bald wrote: »

There haven't been any reports on MSE or in the media that I am aware of that claim a mortgage had been declined because someone had opened a number of current accounts for the purposes of distributing their savings. It would be good if some of those actually involved in approving mortgages would comment on the matter. I am sure we have people with the appropriate knowledge amongst the posters?

I did see a report here from someone who said this had happened. However it was in the middle of a thread about something else, and I can't find it right now. It was in the last few months.

andrewthomas2008

I've deposited money into my isa this tax year, so will I have to wait until April to open the new Help to buy isa?

I'm really annoyed at myself to be honest!

Thanks for any replies.

jimjames

andrewthomas2008 wrote: »

I've deposited money into my isa this tax year, so will I have to wait until April to open the new Help to buy isa?

I'm really annoyed at myself to be honest!

Thanks for any replies.

Assuming you mean cash ISA. If so the rules haven't been published yet but if the requirement is that you haven't got a cash ISA for this year then it may be possible to transfer your existing ISA into a S&S ISA so you then meet the rules.

mhamilton123321

I currently pay into a cash ISA monthly, does anyone know if this means I will have to wait until April or whether this can be transferred in Dec? I haven't opened a new cash ISA, I have paid into it every month for the past 2 years but it wasn't clear on the info page.

kllk_2011

I have a couple of questions I would be grateful if anyone could answer:

- I had a cash ISA in the last financial year, however this financial year I opened a current account with the same provider as my ISA and was therefore able to benefit from a better ISA rate so I completed the necessary form and swapped the ISA over. I presume this means I can't open a help-to-buy ISA until April 2016. Is there anyway I can find out if I have opened a new ISA in this financial year?

- Has anyone read anything about the limits? Are they subject to change if house prices increase rapidly for example? £250k would be more than I could borrow now, but in a few years wouldn't want to lose the bonus if house prices have sharply increased!

- I have also read conflicting comments about paying in to other cash ISA's. If I let my current cash ISA which isn't a fixed one roll forward into the next financial year - can I pay £200 into the help to buy ISA and any excess savings into the cash ISA?

Thanks everyone!

deedsmcd

I've never owned a house, but am considering buying a site and building one at some stage down the line. Will the Help to Buy ISA apply to me? Would it help to buy a site or the cost of building a new home? I haven't seen this question answered anywhere.

Many thanks!

eskbanker

kllk_2011 wrote: »

I had a cash ISA in the last financial year, however this financial year I opened a current account with the same provider as my ISA and was therefore able to benefit from a better ISA rate so I completed the necessary form and swapped the ISA over. I presume this means I can't open a help-to-buy ISA until April 2016. Is there anyway I can find out if I have opened a new ISA in this financial year?

Assuming 'swapping the ISA over' means opening a new one and transferring the proceeds in, then yes, you've opened a new one. However, if it only contains prior year funds (i.e. you haven't paid new money into it since 6 April) then this doesn't affect anything to do with this year's allowance or prevent you from opening an HTB ISA.

kllk_2011 wrote: »

Has anyone read anything about the limits? Are they subject to change if house prices increase rapidly for example? £250k would be more than I could borrow now, but in a few years wouldn't want to lose the bonus if house prices have sharply increased!

I don't believe any escalation or indexation has been considered (or at least published) yet.

kllk_2011 wrote: »

I have also read conflicting comments about paying in to other cash ISA's. If I let my current cash ISA which isn't a fixed one roll forward into the next financial year - can I pay £200 into the help to buy ISA and any excess savings into the cash ISA?

The general principle continues to apply, i.e. that all current year cash ISA contributions need to be in the same place, so no, you can't put new money into an HTB and a normal cash ISA in the same tax year.

eskbanker

deedsmcd wrote: »

I've never owned a house, but am considering buying a site and building one at some stage down the line. Will the Help to Buy ISA apply to me? Would it help to buy a site or the cost of building a new home? I haven't seen this question answered anywhere.

It's not explicitly answered but the published documentation such as the government paper (see section 3.11) clearly refers to the money being used "towards the purchase of a first home", so personally I'd have thought it unlikely that buying land and building would qualify.

bbjm79

I have been paying into a cash ISA this financial year.

When I pulled my head out of the sand and realised a H2B ISA was a good idea, I closed the cash ISA and dumped it into a current account. In total, I have paid just under 2k into a cash ISA this year.

Will I have to wait until April to apply, or can I just open a H2B ISA with the initial £1200?

Assuming I have to wait, would I be likely to get into trouble for applying for one in December anyway?

Archi_Bald

Closing an ISA doesn't erase the records that say you paid into an ISA this financial year.

Theoretically, clauses 12.30 onwards about "self repair" in the ISA Guidance Notes could apply if you closed an earlier cash ISA. But I couldn't say for certain, and there's next to no info about HTB ISAs available so far.

As the ISA reporting is a pretty well-oiled engine, they will find out that you had an ISA already this year, and I wouldn't chance things without having got confirmation from the HMRC. Try the ISA Helpline on 0300 200 3312