Htb or isa?

makemerich12 · 12 May 2019 at 9:47PM

I'm currently awaiting details to start saving into a lisa with Newcastle building society that i plan to use to buy a house in a few years time so that leaves me with 16k over the year to put somewhere.

Yesterday i opened a htb isa but i'm regretting it now thinking i should of just opened a new isa with the max allowed in only £200 a month with the htb. Could i close this and open a isa instead or would i break the paying into a tax year code already even though i opened yesterday ?:money:

Rich2808 · 13 May 2019 at 2:12AM

You can pay in £1200 in month 1 with the help to buy isa - and if you pay in £200 for two more months by month 3 you would be eligible to get a £400 bonus when buying a house.

A Lifetime isa may be more useful however if your purchase is not imminent - the bonus is higher and the property limit is £450k whereas outside London its only £250k for the HTB isa.

You can have both products - and HTB isas pay much better rates. You need never buy a house or get a bonus with it. It doesn't have to restrict your ability to pay into a cash isa in the same year - if you invest with a split isa provider such as Nationwide or RBS/Natwest or Aldermore.

makemerich12 · 13 May 2019 at 4:15PM

But which one should i ditch if i'm allowed?

Newcastle Cash Lifetime ISA 1.10% ( Awaiting approval ) Max input-£4000 a year

HSBC Help to Buy ISA Deposited -£1.200 opened Saturday- Max input £3,000-£200 a month

If i kept both of theses i could only save £7000 for the year , But if i can Cancel one without breaking rules i could get a isa and save upto £16k ontop of last years isa, Correct?:money::money:

Rich2808 · 13 May 2019 at 7:40PM

You can have both.

Personally if flexibility is key I would recommend transferring your help to buy isa to Nationwide or RBS/Natwest - they pay 2.5% vs 2.25% at HSBC. You can also then invest in other cash isas with them unlike HSBC as they are a split isa provider.

And also you can keep your lifetime isa with Newcastle.

There may of course be other savings options paying better rates than cash isas - particulary if you are only a basic rate taxpayer so get a £1,000 interest tax free allowance.

makemerich12 · 13 May 2019 at 8:05PM

So i could close my Hsbc htb without breaking the paying in the same tax year rule (opened Saturday) and then reopen the Help to buy with Nationwide and also a Single Access ISA with them.

Plus keep my Lisa with Newcastle?

makemerich12 · 14 May 2019 at 4:57PM

So went to HSBCt today and they told me i could cancel the account during the cooling off period but i wouldn't be able to open a new htb this year and transfer it.

Went to nationwide and requested a transfer plus a split isa that's agreed i can do, the only problem they had was can i also have the lisa with Newcastle building society thats the news i'm awaiting on noone had headoffice knew

Gordon_the_Moron · 14 May 2019 at 7:08PM

You can have a LISA and a cash ISA in the same tax year (just as you can have a stocks and shares ISA and a cash ISA) they're too separate types of ISA product, just be mindful you can only pay £20k in across ALL your ISAs so if you put £4000 in Newcastle, you would only then be able to put £16k not £20k in Nationwide (and because they can't see your Newcastle account the limits showing in your online banking will NOT reflect this, they'll say you can pay £20k in. Just make sure you are £4k short of "filling" the Nationwide account.

Help to buy ISAs on the other hand aren't classed as separate for some silly reason, they're a type of cash ISA. That means you can normally only pay into a cash ISA or HTB, however some providers let you have more than one ISA with them in the same year and report it back to HMRC as one account rather than multiple accounts (they're allowed to do this but most don't)

Nationwide is the only one I know that does allow it, pays a decent HTB rate and offers flexibility to withdraw and repay in the same tax year (be careful withdrawing from the HTB though - you'd likely have to replace the contributions in the normal cash ISA as the £200 a month limit isn't flexible)

You don't need to close the HSBC account and reopen at Natwest (and I'm not sure if you can if you've already pay into the HSBC account) just go to Nationwide and request a transfer.

Last thing to note, if you've paid cash into the HSBC help to buy ISA you must wait until it's transferred to Nationwide before paying into the loyalty account.

makemerich12 · 14 May 2019 at 8:21PM

Thank you have already requested a transfer on the htb with HSBC to Nationwide and will be opening a split cash ISA when that's complete.

So Basically it's the lisa i need to close as i can't have that a Cash isa and HTB isa with nationwide?

[STRIKE]Newcastle Lisa[/STRIKE]
HTB Isa Nationwide
ISA Nationwide

glaister · 14 May 2019 at 9:03PM

LISAs do not count as cash ISAs. You can contribute to a cash LISA and a cash ISA / HTB ISA in the same tax year.

That means you can have both your Nationwide split cash / HTB ISA and your Newcastle BS LISA and contribute to both in the same tax year.

makemerich12 · 14 May 2019 at 9:33PM

glaister wrote: »

LISAs do not count as cash ISAs. You can contribute to a cash LISA and a cash ISA / HTB ISA in the same tax year.

That means you can have both your Nationwide split cash / HTB ISA and your Newcastle BS LISA and contribute to both in the same tax year.

So i'd be Limited to
Newcastle-£4000
HTB-£4000
Isa-£1200
Could i ask where you have this Information from for back up? Thank you :T

Gordon_the_Moron · 15 May 2019 at 8:03AM

You'd be limited to £4k LISA.

£3800 H2B (£1200 first month and £200 the remaining 11) then in future years £2400.

That leaves you £12200 allowance for the cash ISA (£13600 in future years)

I know you can have a LISA and the Nationwide split. I've had that since they launched LISA.

Htb or isa?

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