The Help to Buy ISA: what you need to know
Please note, this is an informational page only. We do not offer ISAs at Raisin UK.
The Help to Buy ISA was created to help people take their first step onto the property ladder.
The scheme was closed to new applicants in November 2019, but you can continue saving into your ISA if you already have one, as well as claiming your government bonus. Here you’ll learn how the Help to Buy ISA works, how to claim the government bonus and how you can save for a mortgage deposit in alternative ways if you don't have a Help to Buy ISA.
Key takeaways
Existing account holders can save up to £200 per month, with the government adding a 25% bonus (up to £3,000) when they buy their first home.
You can no longer open a Help to Buy ISA. Existing account holders can continue saving until November 2029 and must claim their bonus by 1 December 2030.
If you don't have an existing account, you can use other first-time buyer savings accounts like the Lifetime ISA, explore government schemes such as Shared Ownership, and or grow your deposit with savings accounts.
The information provided here is for informational and educational purposes only and does not constitute financial advice. Please consult with a licensed financial adviser or professional before making any financial decisions. Your financial situation is unique, and the information provided may not be suitable for your specific circumstances. We are not liable for any financial decisions or actions you take based on this information.
A Help to Buy ISA is a type of savings account specifically designed to help first-time buyers save for a mortgage deposit. As with other types of ISAs, any interest you earn is tax-free. In 2019, the Help to Buy ISA closed to new applicants, although if you’re an existing account holder you can continue to save into your account until 30 November 2029.
What is a Help to Buy ISA?
A Help to Buy ISA is a type of savings account specifically designed to help first-time buyers save for a mortgage deposit. As with other types of ISAs, any interest you earn is tax-free. The Help to Buy ISA is now closed to new applicants, although existing account holders can continue to save up to £200 a month with the scheme until 30 November 2029. To help you reach your deposit goal, the government provides a 25% bonus on your savings. This means for every £200 you save, the government tops it up with an extra £50.
To qualify for the minimum government bonus of £400, you need to save at least £1,600. The maximum bonus you can receive is £3,000, which is reached by saving £12,000. While you can save more than £12,000 in your account, the government bonus is capped at £3,000. Your bonus is paid out when your solicitor or conveyancer applies for it during the purchase of an eligible first home.
According to Treasury figures, 612,426 property completions were supported by the Help to Buy ISA between launch and June 2024, with an average bonus value of £1,291*.
Is Help to Buy still available?
In 2019, the Help to Buy ISA closed to new applicants, although if you’re an existing account holder you can continue to save into your account until 30 November 2029. You then have until 1 December 2030 to claim your government bonus.
The Lifetime ISA is an alternative that can help first-time buyers save consistently, build up a deposit and get on the housing ladder
How does a Help to Buy ISA work?
After making a maximum initial deposit of £1,200 when the account was opened, you can make monthly contributions of up to £200. The government will top up contributions by 25% (up to a maximum of £3,000) when you buy your first home.
Put simply, for every £200 you save in a Help to Buy ISA, the government will add another £50.
Under the Help to Buy ISA rules, you will need to save a minimum of £1,600 to receive the government bonus. The maximum £3,000 bonus is based on a balance of £12,000. You can pay in more than £12,000, but you won’t receive a government top-up on any savings over this limit.
Your savings | Government bonus | Total value |
£1,600 (minimum) | £400 | £2,000 |
£4,000 | £1,000 | £5,000 |
£7,000 | £1,750 | £8,750 |
£10,000 | £2,500 | £12,500 |
£12,000 (maximum) | £3,000 | £15,000 |
Your Help to Buy ISA savings do not need to cover the entire mortgage deposit.
Criteria to use a Help to Buy ISA towards a property purchase
To use your Help to Buy ISA savings and bonus towards a property purchase, you must:
- Be a first-time buyer, meaning you’ve never owned a home anywhere or the world
Purchase a property in the UK for £250,000 or less, or £450,000 or less in London
- Intend to live in the property as your only home
- Use a residential mortgage for the transaction
You can use a Help to Buy ISA with any residential mortgage and you don’t need to have a Help to Buy equity loan. Your mortgage doesn’t need to be with the same provider as your Help to Buy ISA, so consider researching the market to find a mortgage that suits your circumstances.
How do I claim the Help to Buy bonus?
Once you’re ready to buy a property, ask your bank to close your Help to Buy ISA. They’ll write a letter confirming the account is closed, which you’ll need to give to your solicitor or conveyancer. They will then use the letter to apply for the government bonus between the point of exchange and completion (don’t wait until after completion, as it will be too late). Bear in mind that your solicitor can charge an administration fee of up to £50 plus VAT for completing the application.
The government bonus can’t be used for the exchange deposit or to cover any associated costs, such as conveyancing fees. It can only be used towards the deposit paid at completion. This prevents buyers from claiming the bonus and then pulling out of the sale.
You must apply for your Help to Buy bonus within 12 months of closing your account. The latest date you can claim your bonus is 1 December 2030.
Alternative ways to save for a mortgage deposit
If you don’t already have a Help to Buy ISA, or you’ve reached the monthly or yearly contribution limit, you may want to look at some alternative options such as savings accounts and ISAs.
- The Lifetime ISA (LISA): Often seen as the closest replacement for the Help to Buy ISA, the LISA allows those aged 18–39 to save up to £4,000 a year towards their first home or retirement. The government adds a 25% bonus to your contributions (up to £1,000 annually).
- Fixed rate bonds: If you have a lump sum saved and know you won't need to access it for a set period (e.g., 1 or 2 years), locking your money away in a fixed rate bond often provides competitive interest rates to help build your deposit.
- Notice accounts: If you are actively house hunting but haven't found the perfect property yet, notice accounts can offer a great a middle ground between fixed rate bonds and easy access. You earn variable interest rates that are typically higher than easy access savings, but you only need to give your bank a set notice period (like 30 or 90 days) before withdrawing your deposit funds.
- Easy access savings accounts: If you are ready to make an offer on a house and need immediate access to your cash, an easy access account allows you to withdraw your money when you need it while still earning interest.
FAQs
What was the Help to Buy Equity Loan?
The Help to Buy government scheme was an equity, or low-interest, loan from the government that you could put towards a deposit on a new-build property. First launched in 2013, the initiative was designed to support people who were struggling to save enough money for a deposit on a new home.
Help to Buy: Equity Loan closed to new applications on 31 October 2022. Homebuyers needed to legally complete the purchase of their home by 31 May 2023 to be eligible for an equity loan. Similar schemes operate in Wales and Scotland.
Can I make withdrawals from a Help to Buy ISA?
You can withdraw money from your Help to Buy ISA at any point, but bear in mind that the government bonus is based on your closing balance (including interest). This means any money you take out before closing your Help to Buy ISA won’t be included in the final bonus calculation.
It’s also worth noting that the monthly deposit limit remains the same. So if you pay in the maximum amount of £200 at the start of the month and remove some or all of it a week later, you’ll need to wait until the following calendar month to make another contribution.
How to close a Help to Buy ISA
With most providers, you can visit your bank branch and request to close the account. Some providers let you do this online.
It’s important to note that if you close your account and transfer the funds to a Help to Buy alternative, such as a savings account, you may have to consider potential tax implications. However, because basic-rate taxpayers can earn up to £1,000 interest a year before paying tax (higher-rate taxpayers can make £500), many savers find tax isn’t an issue.
Are there any government alternatives to the Help to Buy ISA?
There are several Help to Buy ISA alternatives organised by the government, housing associations and local authorities:
Lifetime ISA (LISA): You can open a stocks and shares or cash ISA and save a maximum of £4,000 per tax year, with a 25% government bonus. The money must be used to purchase a first home, or for retirement.
Shared Ownership Scheme: You can purchase a share for as little as 10% of a property’s market value and pay rent on the remaining share. You can gradually increase your ownership stake by as little as 1% per year for the first 15 years.
First Homes Scheme: First-time buyers can purchase a new-build house or other property at a discount of 30% off the market price. This scheme aims to make it easier for those on lower incomes to have a chance of homeownership.
Rent to Buy: You can rent a new-build house or other property at a discounted rate (usually around 20% below market value) for a fixed period, with the option to purchase the property at a discounted price at the end of the period.
Mortgage Guarantee Scheme: If you want to buy a home, you can get a mortgage loan with a deposit of just 5% of the property’s purchase price, with the government providing lenders with a guarantee on the mortgage. The original scheme ended in June 2025, but was replaced by a permanent scheme in July 2025.
Right to Buy: This government home purchase scheme is available to council and housing association tenants in England. You can buy your home at a discount, making it easier to become a homeowner.
Is the Lifetime ISA similar to a Help to Buy ISA?
The Lifetime ISA follows Help to Buy ISA rules, i.e. you must be a UK resident and a first-time buyer to qualify for the LISA, meaning you’ve never owned a home anywhere in the UK or elsewhere. The property must also be in the UK, be your only home, and be intended for your own residence, not for renting out. Unlike the Help to Buy ISA, the bonus is paid monthly rather than on completion. However, you’ll need to wait 12 months after opening a Lifetime ISA before you can use the money to buy your first home.
Will the government replace the Help to Buy ISA?
While the government hasn’t announced any plans for a Help to Buy ISA replacement, the Lifetime ISA (LISA) is similar.
The Lifetime ISA is also designed to help people save for a first home (or retirement), and offers a 25% government bonus of up to £1,000 per year.
Anyone aged 18-39 can open a Lifetime ISA and save up to £4,000 per tax year into the account. To receive the bonus, you’ll need to purchase a property that costs £450,000 or less with any residential mortgage.
What happens to a Help to Buy ISA if I decide not to buy a home?
If you change your mind and decide not to buy a property, or if you buy a property that exceeds the price limits, you will not receive the 25% government bonus. However, the money you saved is still yours. You can withdraw your funds and keep any tax-free interest you earned while the money was in the ISA without paying a penalty.
Save for a mortgage with Raisin UK
You’ll find a wide range of savings accounts on the Raisin UK marketplace that may help you save towards a mortgage.
Simply register for a Raisin UK account to apply online for fixed rate bonds, notice accounts, and easy access savings accounts from a range of UK partner banks and building societies. It only takes a few minutes and it’s completely free.
* HM Treasury Help to Buy: ISA Scheme Quarterly Statistics. Data from 1 December 2015 to 30 June 2024.
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All interest rates displayed are Annual Equivalent Rates (AER), unless otherwise explicitly indicated. The AER illustrates what the interest rate would be if interest was paid and compounded once a year. This allows individuals to compare more easily what return they can expect from their savings over time.
Raisin UK is a trading name of Raisin Platforms Limited which is authorised and regulated by the Financial Conduct Authority (FRNs 813894 and 978619). Raisin Platforms Limited is registered in England and Wales, No 11075085. Registered office: Cobden House, 12-16 Mosley Street, Manchester M2 3AQ, United Kingdom. The information on this website does not constitute financial advice, always do your own research to ensure it's right for your specific circumstances. Tax treatment depends on the individual circumstances of each customer and may be subject to change in the future.