It is almost crunch time for our finances – because April is the month when there are lots of changes that affect how much we have in our pockets.
Price hikes on a range of bills begin next week. Then the new tax year starting on April 6 heralds yet more pain. But it’s not all bad news.
Some of us will receive a rise in hourly wages, reduced tax bills and an increase in the state pension.
It’s hard to keep up with what is happening and when – so we have pulled together an at-a-glance guide to help you avoid ending up with any nasty surprises.
Less in your pocket...
April 1
- Council tax bills – almost all local authorities plan to raise council tax this year, by a typical 4.7%. For an average Band D property that means a £78 rise to £1,750.
- TV licence – fee will rise from £150.50 to £154.50.
- NHS prescriptions – cost goes up from £8.80 to £9 for each item.
- Energy bills – about 11million households on standard variable tariffs will see bills increase by £117 as the energy price cap rises from a typical £1,137 to £1,254.
The cap was brought in by the Government in a bid to make the energy market fairer for all. It limits the amount energy firms can charge households on these default tariffs – typically people who do not shop around and switch to the best deals.
When the cap was introduced in January it cut bills by on average £76 – but that saving will be wiped out by this price increase.
- NHS dentists – visits will cost more, with Band 1 inspections rising by £1.10 to £22.70 and Band 2 increasing by £3 to £62.10.
- Water bills – to rise by an average of £9. South West Water customers will be paying £14 more on average, while those in the North-West served by United Utilities will pay an extra £18.
- Television and broadband – Sky TV and broadband customers will see their bills rise by up to £96
a year. Sky Entertainment, fibre broadband and talk anytime packages will all cost £2 more per month and Sky Broadband Unlimited bills will cost an extra £1. People with multiple products could face increases up to £8 a month. Sky says the average rise is £3.50 a month. - Mobiles – 02, Vodafone and Three customers will be hit by 2.5% price rises. Meanwhile, bills for Virgin Mobile customers could increase by up to £150 a year. EE prices will be hiked 2.7% tomorrow.
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April 6
- Car tax – vehicle excise duty will be increasing, with some drivers having to pay £65 more. The majority will pay an extra £5.
- Pensions – minimum auto-enrolment contributions are to rise and you will now be putting in 5% of your salary rather than the current 3%. An employee on £20,000 will pay an extra £18.62 per month, while those earning the average wage of £29,669 will pay an extra £31.52.
But putting a bit more away now will mean you do have extra in your pension pot to see you through a more comfortable retirement. And your boss is putting more in too – 2% instead of 1%.
More in your pocket...
April 1
- National living wage – increasing by 4.9% to £8.21 per hour for those aged 25 and over. Rates for younger workers rise too. They go up from £7.38 to £7.70 for people aged 21-24, from £5.90 to £6.15 for the 18-20 age group, and from £4.20 to £4.35 for those aged 16-17.
April 6
- Personal tax allowance – this rises from £11,850 to £12,500 and the 40% income tax rate now starts on earnings from £50,000. Basic rate taxpayers will see £130 annual savings and higher rate taxpayers could be up to £860 better off.
- National Insurance – a change means the threshold will kick
in after you earn £8,632. Those earning below that will not pay NI. On wages between £8,632 and £50,000 you pay 12% NI, while above that the rate is 2%. - Marriage allowance – this rises from £1,190 to £1,250, meaning the amount that can be saved will go up from £238 to £250 per year for couples who share their tax allowance when one of them is earning below the personal tax allowance.
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- State pension – rising by 2.6%. People on the old basic state pension will get £129.10, up £3.25 a week. Those on the new state pension will see their income rise £4.25 to £168.60. But some people may have to wait longer than they expected to get their state pension, as the qualifying age is gradually rising to 66 by next year.
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- Student loans – the amount graduates can earn before they start to repay their loans increases from £25,000 to £25,725, saving those who started university from 2012 just over £65 a year.
- Universal credit – work allowances for this mean those people affected can earn £1,000 more before UC starts to be withdrawn. The Government says that about
2.4million households will get to keep an extra £630 each year. - Capital gains tax – the annual CGT allowance increases from £11,700 to £12,000.
