Can I transfer my help to buy ISA into stocks and shares normal ISA?

AK47UK

Hi all, I had been saving in a help to buy ISA for my first home but cannot use it as the value of the home exceeds the limit. Am I resigned to withdrawing this as cash and so losing that tax-free allowance or can I transfer into a normal stocks and share ISA without using more of this years ISA allowance?

In honesty I can't see how I would use this years allowance anyway but I thought were something to happen (such as winning something) then it would be good to have the option of putting it into my ISA.

Thanks

Alexland

What is the price of the property you are looking to buy? Have you considered transfering the HTB ISA to a Lifetime ISA from Skipton which would offer the 25% bonus on any suitable UK property up to £450k? This is better than the HTB limit of £250k outside of London but the same as the £450k limit within London. The LISA would need to be open at least 12 months before withdrawal to get the bonus.

AK47UK

The LISA would have been perfect except I was ready to buy now so even had I opened the cash LISA on the day it went live I wouldn't have completed the year yet and I have had an offer accepted at just over 250k I have got some friends to open that cash LISA now though to start their 12 months!

Is the help to buy ISA just like any normal cash ISA in the way I can transfer it into a stocks and shares ISA? I was thinking ti may be treated differently.

Thanks again

bowlhead99

AK47UK wrote: »

Is the help to buy ISA just like any normal cash ISA in the way I can transfer it into a stocks and shares ISA? I was thinking ti may be treated differently.

Yes you can transfer it, it's just a specialist type of cash ISA. So you can transfer it into another cash ISA or into one of the other 3 major types (LISA, IFISA, S&SISA). People generally don't transfer them out due to the lack of ability to put back in (the monthly limit) and wanting to get the biggest bonus they can - but as you're not going to be able to use if for a house purchase you can just give up on it and move it elsewhere as if it was a 'normal' cash ISA.

If you want to move it into an S&S ISA you just need to follow the normal rules - i.e. open up that ISA with the new ISA manager and fill out their form to request to that new ISA manager that they go get your money from the transferring account.

Of course, if you're going to be completing on a house soon and will not have much time or funds to max out your current year £20k ISA allowance after that anyway or fill next year's either, it might suit you just to withdraw the lot in cash, use some of it to buy your house, and manually reinvest the spare money in the S&S ISA without hitting the limit.

Alexland

Also worth remembering that a fairly high proportion of property sales fall through (sometimes after 5 months of conveyancing) or if the market obviously dropped you could revise your offer below £250k (but not in Scotland) so as there is no LISA withdrawal penalty in this first tax year it might still be worth transfering to a LISA or keeping the HTB ISA for the next few months until you have exchanged contracts and know this property is definitely going to complete to keep your options open?

AK47UK

Thanks to both of you. Yes Alex my plan was to leave it in the HTB ISA until the point of exchange/getting the keys and then transferring it. I was lucky enough to get the 4% Santander HTB ISA so at least I am earning some decent interest on that money where it is.