Help to Buy: ISA - Key Features

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The Financial Conduct Authority and the Prudential Regulation Authority are the independent financial services regulators. Monmouthshire Building Society is required to give you this important information to help you decide whether our Help to Buy: ISA is right for you. You should read this information carefully so that you understand what you are buying, and then keep it safe for future reference.

At the current time, this account can only be opened by new customers who live within the following postcode areas: NP, CF, SA, LD, WR, GL, HR & BS. Existing Society customers may open this account.

What is the purpose of this page?

The purpose of this Key Features document is to describe the key features of our Help to Buy: ISA product and to provide a balanced summary, so that you can make an informed decision.

Our Help to Buy: ISA is designed to reward first time buyers who are saving for their first home. This product is simple to open and offers an attractive rate of interest.

The Aims

  • To help first time buyers make their first step onto the property ladder.
  • To provide first time buyers with an attractive rate of tax-free interest, with an additional 25% Government bonus on the closing balance of the account, when you purchase your new home subject to Help to Buy: ISA Scheme Rules.

Your Commitment

  • To maintain a minimum balance required in accordance with the Terms & Conditions of the account.
  • To not exceed the monthly Help to Buy: ISA subscription limits following the opening of the account.
  • To use the account to save towards the purchase of your new home.
  • To save the minimum closing balance of £1,600 in order to be eligible for the 25% Government bonus. The bonus must be included with the funds consolidated at the completion of the property transaction. The bonus cannot be used for the deposit due at the exchange of contracts, to pay for solicitor's, estate agent's fees or any other indirect costs associated with buying a home.

Risk Factors

  • The taxation of ISAs can be changed at any time by the Government without notice.
  • The Help to Buy: ISA Scheme can be amended or withdrawn at any time.
  • The interest rate payable could go down as well as up, depending on general market interest rates and the Bank of England Base Rate.

    Your Questions Answered

    What is an ISA?

    ISA stands for Individual Savings Account. It allows your savings to grow tax-efficiently. There are three types of ISAs available:

    • Cash ISA
    • Stocks & Shares ISA
    • Innovative Finance ISA
    Monmouthshire Building Society only offer Cash ISAs.

    Can I open an Cash ISA?

    You can open a Cash ISA if you are:
     
    • Aged 16 or over and
    • Resident in the United Kingdom, or perform duties as a crown employee overseas or are in a marriage or civil partnership with such a person

    Accounts can only be opened in a sole name. Joint accounts are not permitted for ISAs.

    What are the tax advantages?

    Any interest earned on your Help to Buy: ISA will be free of personal UK Income Tax and Capital Gains Tax. You are not required to declare any interest on your Help to Buy: ISA on your Tax Return.

      What type of Cash ISA do Monmouthshire Building Society offer?

      The Society offers a Help to Buy: ISA – a variable rate Cash ISA designed to encourage first time buyers to save towards the purchase of their first home, where the Government will pay a 25% bonus on the final balance of the account, subject to Help to Buy: ISA Scheme Rules

      The Society also offers a variable rate Cash ISA.

      Other ISAs may be offered from time to time and details are available on request from the Society’s Head Office branch. Please note, that products can be withdrawn or replaced at any time and without notice.

      How much can I save?

      The current annual subscription limits to ISAs are:

      • Overall maximum investment is £20,000.
      • Investors may subscribe to ONE Cash ISA, ONE Stocks and Shares ISA and ONE Innovative Finance ISA only in each tax year.
      Investors have additional flexibility in deciding the balance of their investments provided they keep within the £20,000 annual subscription limit. ISA savings can be held in Cash, Stocks and Shares or Innovative Finance ISA in any combination that the investor wishes.

      For example — an investor could subscribe:
        • £20,000 in a Cash ISA, £0 to a Stocks and Shares ISA and £0 to an Innovative Finance ISA.
        • £10,000 in a Cash ISA, £5,000 to a Stocks and Shares ISA and £5,000 to an Innovative Finance ISA.
        • £0 in a Cash ISA, £0 in a Innovative Finance ISA and £20,000 to a Stocks and Shares ISA.
        • £0 in a Cash ISA, £0 to a Stocks and Shares ISA and £20,000 to an Innovative Finance ISA.
        Lifetime ISA's can be held alongside Cash, Stocks and Shares or Innovative ISA's and contributions will form part of your annual ISA allowance. Lifetime ISA's are subject to certain conditions and are not available through Monmouthshire Building Society.

        The Help to Buy: ISA allowance is lower than the overall ISA allowance. You can only save up to £1,200 in the first calendar month of opening your Help to Buy: ISA and up to £200 per calendar month thereafter. Please note that your remaining ISA allowance can only be invested into a Stocks and Shares ISA or Innovative Finance ISA, up to the maximum annual ISA limit.

        Financial Services Compensation Scheme

        We are part of the Financial Services Compensation Scheme (FSCS). Details of the scheme, and who is covered by it, are available here.

         
         


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