Summary Box - Help to Buy ISA
1. What is the interest rate?
It’s a variable rate as shown in the table below
|Your balance||Annual interest|
- Your interest is paid annually on the anniversary of the account opening.
2. Can Bank of Scotland change the interest rate?
As this account pays a variable rate of interest the rate can change over time. For example we might review the interest rate if the Bank of England bank rate changes. We’ll always let you know of any planned changes to the rate. Our terms and conditions explain when and how we do this.
3. What might the future balance be?
Below is an example of what the future balance might be, after interest has been paid:
|Initial deposit||Regular deposit||Tax free rate||Balance at 12 months|
This example assumes that:
- You don’t withdraw any money and interest isn’t paid out of the account
- The interest rate stays the same
- You make regular deposits in the middle of each month
In addition, the UK government will pay a 25% bonus on your final balance. The minimum bonus of £400 is payable on closing balances of £1,600. The maximum bonus of £3,000 is paid on closing balances of £12,000 or more.
4. How do I open and manage my account?
This account can be opened and managed in branch, by phone or online.
Saving together? If you’re planning to purchase your home with another first time buyer, you can both open a Help to Buy: ISA and claim government bonuses of up to £3,000 each.
Opening this account
You are eligible for this account if you are:
- 16 or over
- a resident in the UK (for tax purposes)
- a first-time buyer saving for your first home
To open this account you will need to:
- open the account in your sole name
- open the account with between £1 and £1,000
- ensure funds are received within 21 days of account opening
You can transfer funds to a Help to Buy: ISA from an existing ISA. For transferring in from a Lloyds ISA, read our internal transfer guide (pdf) for more information. Otherwise, read our external transfer guide (pdf).
Managing this account
- You can pay in up to £200 in any calendar month. This must be paid by standing order and received by the 25th of the month (this can include the month you open your ISA).
- ISAs have an annual limit of £20,000 per tax year. This means that you can't pay more than this limit into any combination of ISAs within the same tax year.
- The Help to Buy: ISA allowance is lower than the overall £20,000 ISA allowance. If you want to reach the full ISA limit in a tax year, you can invest any other new contributions into a stocks and shares ISA and/or a lifetime ISA and/or an innovative finance ISA.
- Keep in mind, the Help to Buy: ISA is a cash ISA and you can only save into one cash ISA in a tax year. Read our guide to ISAs for more information.
5. Can I withdraw money?
You can make unlimited withdrawals or close the account at any time in branch, but it’s important to note that you won’t be able to claim any Help to Buy: ISA bonus on the funds you withdraw.
If you choose to close the account and move the money to a non-ISA account, your savings will lose their tax-free status. The tax treatment depends on your individual circumstances and may change in future.
6. Additional information
Receiving your bonus
To start the claim for your bonus, you need to :
- close your account in branch in one transaction when you are ready to purchase your first UK property (up to the value of £250,000 outside London and £450,000 inside London). Any costs incurred before the completion of the property purchase cannot be covered by the bonus.
- provide your Help to Buy: ISA closing documents to your conveyancer and they will claim the bonus on your behalf. Your conveyancer must be approved as an eligible conveyancer under the Help to Buy: ISA scheme.
Tax free is the rate of interest payable to you where your interest is exempt from income tax.
AER stands for Annual Equivalent Rate and illustrates what the interest rate would be if interest was paid and compounded once each year. As every advertisement for a savings product which quotes an interest rate will include an AER, it makes it easier for you to compare what return you can expect from your savings over time.