Chancellor George Osborne has announced plans in his pre-Election budget for a large-scale revamp of ISAs – including the introduction of increased flexibility and plans to help first-time home buyers in their attempts to climb upon the property ladder.

Osborne’s announcement to Parliament outlined the possibility of making withdrawals from an ISA without losing the tax-free subscription allowance in that tax year, as well as a ‘help to buy’ ISA, aimed at those saving for a deposit for their first home, into which the government will top up savers’ contributions. The government will also extend the range of ISA-eligible investments.

Speaking after Wednesday’s Budget, Alan Clifton, Partner at The Financial Planning Group in Teddington, said; “The news of a fully flexible ISA is great news for savers and the potential of a ‘help to buy’ ISA is a very interesting concept that we look forward to hearing more details about from the Chancellor and to see how such a scheme would work in practice.”

Initial details suggest that for every £200 contributed into a ‘help to buy ISA’, the government will contribute £50. The bonus is being offered for each person, not each house, so a couple will be able to get up to £6,000 towards their purchase. The payment will be made towards a first home – it cannot be used to fund a buy-to-let property, even if the buyer does not own another home. The cost of the homes that the account can be used to buy is capped at £450,000 in London and £250,000 everywhere else in the UK.

As ever, it is important to consider all aspects of the budget and it’s vital to seek advice from a qualified Chartered Financial Adviser when establishing how to best structure your medium-long-term investment plans, or an independent mortgage advisor with access to the broadest range of deal across all lenders.

If you would like to speak to us about your own financial situation, please call us on 0800 731 7614 or by e-mail at enquiries@fpgonline.co.uk and we’d be delighted to help.

Subscribe To The Financial Planning Group Newsletter

Subscribe To The Financial Planning Group Newsletter

 

Why not join our mailing list and receive the FPG quarterly newsletter?  We promise not to bombard your inbox!

You have Successfully Subscribed!