Household bills have begun rising in April, with a raft of increases set to make it harder to make ends meet. Everything from council tax to water bills are rising at the start of the new tax year, and it is important to understand what is changing so you can deal with it accordingly.
Many councils have increased council tax, often by up to around 5%, depending on the local authority, according to analysis by investment platform AJ Bell, a small number of local authorities have been granted permission to increase council tax above the usual threshold. Sadly, you can’t do much to change your council tax, apart from move to a smaller property. But you should double check your property is being taxed in the correct band.
Danni Hewson, head of financial analysis at AJ Bell, said: “About as welcome as a pothole at the end of the road or the bin collectors going on strike, the rise means the average Band D bill has increased by more than a quarter in 5 years, up from £1,898 in 2021 to £2,392 a year in 2026.”
How other bills are rising
Water bills are increasing in many areas,
Water bills are set to rise across England and Wales, with an average increase of 5.4%, with the exact rise depending on your provider. Even the average rise could add an extra £33 a year to your water bills.
Broadband is also set to go up. Some providers have announced fixed annual price increases of a few pounds per month, although the exact amount varies depending on the provider and contract terms. If you’re just out of a contract, you may find your price increase considerably higher, but by shopping around for the best deal you could save money.
Danni Hewson added that similar considerations apply to mobile phone contracts. Some providers allow customers to check their contract status by text or through their online account, including details such as contract end dates and any exit fees. Reviewing your current deal and comparing alternative options, particularly SIM-only plans, could help reduce monthly costs.
Are energy bills rising too?
Unusually, the energy price cap has fallen in April, as the Government’s decision to shift some green levies into general taxation provides some energy bill relief.
This means the average dual fuel household bills should fall by around £117 a year, slightly less than the £150 cut promised, said Ms Hewson. But it is important to enjoy the benefits while they last, as geopolitical tensions are set to make them short-lived.
Ms Hewson added: “The gains will be short lived thanks to the Iran war which has sent energy costs surging again and July’s price cap is expected to rise by at least £300 a year. While long days and summer weather will help take some of the sting out of that increase; the big worry is where the next price cap will be set.
“Households on fixed tariffs will still be cushioned until their current deal comes to an end but finding a new deal may prove difficult with many tariffs having been taken off the market.”
We can help you meet your obligations
We can help you manage rising costs
If you are concerned about increasing household or business expenses, we can help you review your financial position and ensure you are making full use of the tax reliefs and allowances available to you. This may include reviewing your eligibility for reliefs such as allowable business expenses, capital allowances, and other tax-efficient options relevant to your circumstances.
Please get in touch if you would like tailored guidance on managing costs and improving your overall tax efficiency.
Disclaimer:
This article is for general information only and includes commentary and opinions from third-party sources. While care has been taken to ensure accuracy at the time of writing, some examples and statements may reflect individual provider practices or market commentary rather than official government or regulatory rules, although providers are required to operate within applicable regulatory frameworks. Household costs, pricing and policies can vary depending on location, provider and personal circumstances.
RMC Accountants does not provide financial, legal or regulatory advice and accepts no liability for decisions made based on this information. Readers should refer to the official GOV.UK or regulatory guidance, or seek professional advice, before taking action.