ISA: Can you transfer money from one Help to Buy account to another? Rules explained

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Help to Buy ISAs can no longer be opened but many people may still hold an account and be able to contribute to it. Lifetime ISAs (LISA) were launched to replace Help to Buy schemes and it is possible to transfer funds from the old scheme to the new.

Funds held within a Help to Buy ISA can be transferred into a LISA but there are certain limitations in place.

LISAs have an annual limit of £4,000 and as such, transfers cannot exceed this figure.

While Help to Buy ISAs can no longer be opened, it should be noted that it is still possible to transfer money held within a Help to Buy account to another.

This can be done so long as the providers involved offers said Help to Buy ISAs and accepts transfers in.

ISAs of all kinds can have up to £20,000 saved within them in the current tax year.

There are four main types of ISA which includes cash, stocks and share, innovative finance and lifetime ISAs.

Regardless of which ISA is held, the holder will benefit from certain tax perks.

There is no capital gains or income tax levied on money held within an ISA.

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To open an ISA, a person must be:

  • 16 or over for a cash ISA
  • 18 or over for a stocks and shares or innovative finance ISA
  • 18 or over but under 40 for a Lifetime ISA
  • A resident in the UK
  • A Crown servant (for example diplomatic or overseas civil service) or their spouse or civil partner if they do not live in the UK

Junior ISAs can also be set up for children but they have an annual limit of £9,000.

These accounts can only be set up by parents or guardians with parental responsibility for a child aged under 16.

Once the child themselves turns 18, the account will automatically convert to an adult ISA.

Junior ISAs can be opened with a range of banks, building societies, credit unions, friendly societies and stock brokers.

Money can be withdrawn at any time from an ISA without losing any tax benefits.

However, the ISA provider may have certain rules in place or charges for making withdrawals which the holder should check on before taking any action.

For Help to Buy and Lifetime ISAs, withdrawals could also result in the loss of bonus payments.

Additionally, withdrawals from LISAs can also induce a charge if they’re not made for a home purchase or to fund retirement.

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