Your pay, energy bills and savings: How the Budget affects you
Families facing cost-of-living pressures are being offered some assistance, according to Chancellor John Healey. Price rises are forecast to accelerate, particularly in energy bills, in the new year. Here’s how the key announcements in his first Budget affect you and your money.
Help with your energy bill
The chancellor has revived cost-of-living payments by announcing a £100 automatic payment made directly into bank accounts.
20 million homes in council tax bands A to D in England will receive a £100 "Household Energy Payment", funded by extra tax on banks. For your council tax band, check your annual bill or the government's website here, although the website was struggling with traffic post-announcement.
Administrations in Scotland, Wales and Northern Ireland will receive equivalent funding and decide whether to introduce the same payment. This is designed to help with soaring energy bills, with tariffs linked to regulator Ofgem's price cap projected to increase by hundreds of pounds annually, to an annual bill of £2,000 or more in January.
The VAT cut on electricity bills, introduced in October, will also be extended to July, rather than ending in April.
Gas standing charges scrapped
Gas standing charges will be scrapped in England, Scotland and Wales during 2027 "or as soon as possible after", the chancellor said. These fixed daily fees will be shifted onto the price of each unit of energy.
The Treasury estimates that 60% of households will gain an average of £45 a year, with lower users benefiting the most, though not until after the projected rise in bills in January. Higher users, particularly in larger homes and low-income families, will pay more.
The government plans to extend reforms to electricity standing charges later.
Fuel duty help if you drive
The 5p "temporary" cut in fuel duty on petrol and diesel will be extended to July, rather than phasing out in January. This means drivers will still pay the levy at 52p per litre.
Motor fuel prices have risen sharply due to the Iran-Israel conflict, with diesel recently hitting new records, exceeding £2 per litre. The cost of filling a typical family car with diesel has increased by around £30 since late February, while a tankful of petrol costs about £23 more.
You can save £20,000 a year in cash tax-free after all
The chancellor has scrapped his predecessor's plans to reduce the annual personal allowance and isas.