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As the new year begins, the cost of living crisis continues. The Bank of England’s base interest rate has increased by 1.75 points from a year ago, and typical utility bills are hovering around the £2,000 range. However, there are some glimmers of hope. Mortgage interest rates are starting to fall, and employees will receive a little more pay starting this week. Here are some dates that could bring changes to your personal finances in the first half of 2024.
January
First place New price caps for gas and electricity come into effect in the UK. Ofgem’s energy cost limits currently reset every three months and rose by 5% last quarter. Energy costs for households with typical consumption (11,500 kWh of gas and 2,700 kWh of electricity per year) currently cost £1,928 per year for direct debit customers, £1,960 per year for prepay households and £1,960 for pay-as-you-pay households. is limited to 2,058 pounds. Receive your bill. This is lower than this time last year, but there will be no government assistance for most households this winter.
Digital platforms such as Airbnb and eBay have begun collecting data on sellers to share with HMRC as part of global rules to reduce tax avoidance. Data on seller profits is expected to be handed over in January 2025. Traders who use the site for business and don’t declare their income could face a hefty tax bill in the future.
VAT on period pants has been abolished, as has sanitary napkins and tampons. Since the tax is 20%, consumers can expect prices to fall by about 17%. His three-pair pack from Marks & Spencer usually retails for £20, but costs around £3.30 less.
The second Applications are now open for our new free childcare offer for the UK. From April, working parents of two-year-olds will be able to access 15 hours of free childcare a week, extending the current offer for three- and four-year-olds. To qualify, a parent must have an individual’s annual income of at least £8,670 but less than £100,000. The government has announced that starting in September, the 15-hour period will be extended to children up to 9 months old.
6th place Employees’ national insurance contributions will be reduced. As announced in the Autumn Statement in November, the main rate of NICs paid by workers will be reduced from 12% to 10%. Type 1 contributions are paid based on the income received by a person between the age of 16 and state pension age. The Treasury says the changes will mean the average worker earning £35,400 will see their take-home pay increase by around £450 in the 2024-25 tax year. For an employee earning £50,000 a year, after the change he will pay National Insurance of £3,743.00, a saving of £748.60.
17th Inflation statistics for December have been released. Headline interest rates could fall again from the 3.9% recorded in November as retailers cut prices ahead of Christmas.
The 31st Deadline to submit the 2022-23 self-assessment form online. HMRC closed its self-reporting helpline last summer, but it has re-opened but is encouraging people to get information online if possible. If you think your return may be complicated, we recommend starting early in case you need to call.
Various dates begin this month. Mortgage borrowers who took the opportunity to move to interest-only to make their monthly payments more affordable will begin to see the end of the initial six-month term offered by their lenders. What happens next will likely depend on your individual case, and your lender will contact you to discuss your options.
February
First place The Bank of England’s first interest rate decision of the year. Interest rates have remained unchanged for the past three meetings, and we expect some movement in money markets to decline. The next round of GDP statistics is not scheduled to be released until the middle of this month, so the central bank may refrain from speaking this time.
15th day GDP from October to December has been announced. The last set indicated that the UK economy was shrinking, so another negative set would mean the UK would be considered to be in recession. Therefore, the central bank may consider cutting interest rates to stimulate growth.
16th to 23rd Final living expenses will be paid. Government payments are being given to low-income households in England, Scotland and Wales to cover rising prices. The final payment amount of £299 will be paid automatically to anyone who received eligible benefits from 13 November 2023 until 12 December 2023.
march
6th place budget day. With the possibility of a spring election up in the air, the Budget will be a key opportunity for the Conservatives to lay out their big plans to rally voters. Reports suggest this could include schemes to support first-time buyers and changes to inheritance tax.
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The 23rd Bank of England announces next interest rate decision. Some economists are already predicting a rate cut, with more to follow. Borrowers will hope they are right, but a return to subterranean rates seems unlikely at this point.
The council tax bill for 2024-25 is expected to be finalized and announced later this month.
April
First place The following changes to energy price caps are scheduled to come into effect: Cornwall Insight experts suggest that Ofgem’s price limit will fall by 14% at this point, with the average direct debit price dropping to £1,660 a year. At the same time, premiums paid by prepaid customers will be abolished. Those who pay their bills when they arrive will end up paying more.
The price of a TV license will rise by £10.50 per year to £169.50. Water bills may also increase. Details are typically announced in February. Several water companies have been ordered to repay customers £114m, which will offset some of the increase, as progress on leaks and sewage spills is “too slow”.
6th place A new tax year begins. Personal allowances have been frozen again, so more earners will be dragged into the tax net or end up paying more tax at higher rates when pay rises are implemented.
The National Living Wage will rise to £11.44 an hour and the age limit for receiving full benefits will drop from 23 to 21. Young workers will receive £8.60 an hour.
NIC changes for self-employed workers will also be introduced on the same day. These workers will no longer have to pay Type 2 contributions, and the main tax rate for Type 4 contributions will be reduced to 8% for him. Announcing the changes to his Autumn Statement, the Chancellor said he would save self-employed people by £28,200 in profits in 2024-25, totaling £350.
Most state benefits, which are indexed to inflation, will increase by 6.7%, while the state pension will increase by 8.5% on average income, as guaranteed by the triple lock. The new state pension will be worth £221.20 a week.
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