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Help to Buy ISA - capital for UC
Does anyone know what has happened about the government’s plan to exclude Help to Buy ISAs from being considered capital for UC purposes? They are mentioned alongside Lifetime ISAs here:
ADM H1659 says that 25% of Lifetime ISAs can be excluded. But I can’t find anything about Help to Buy ISAs.
Thanks very much.
I don’t think these measures were ever ‘the government’s plan’ as much as they were Boris Johnson’s plan. Consequently, nothing much has been heard about them.
Money in a Help to Buy ISA can be withdrawn any time without penalty, so there is no reason to disregard any of it. There is a bonus paid at the point of completion of a house purchase.
A Lifetime ISA works differently in that the bonus is paid immediately. Whilst funds can be withdrawn from the Lifetime ISA, the bonus needs to be refunded if they are not to be spent on a property purchase or retirement related costs. The 25% disregard reflects that the nominal balance shown on the Lifetime ISA would have to be reduced by that amount if it were to be withdrawn for living costs etc.
Thanks for this Elliot. Much appreciated.
“We are continuing to work on the issue of Lifetime ISAs.”
https://questions-statements.parliament.uk/written-questions/detail/2023-04-27/183161