Anxious April 2026 – how to cope with rising costs and bills

These are very uncertain times, and many people will be worrying about the prospect of higher costs and bills.

It may be impossible to insulate yourself from the financial effects of the conflict in the Middle East entirely, but there are steps you may be able to take to limit the additional burden on your finances.

Even without the higher oil and gas prices caused by the Middle East conflict, many costs are due to rise, meaning an Anxious April for millions of households.

Sarah’s Anxious April checklist

Energy bills falling – for now

The conflict in the Middle East has meant wholesale oil and gas prices have sharply increased, but it isn’t yet affecting the approximately 17 million households on the standard variable tariff. That’s because the energy price cap is due to fall by 7% from April 1st. If you’re in that situation, your energy bill will fall by approximately £10 a month in April, assuming you’re a ‘typical user’ of energy (which means you have an averaged sized property and pay for your gas and electricity by direct debit).

However, if you use more energy and/or pay your bill when it arrives you could pay more, as the energy price cap is only a limit on the daily standing charge and amount that energy companies can charge for a unit of electricity or gas.

When the energy price cap for April was announced in February, there were quite a few fixed rate tariffs that were cheaper than the energy price cap from April. However, since the start of the conflict in the Middle East, they have been withdrawn.

While the energy price cap protects prices until June 30th, there’s obvious concern about how much it could rise by in July.

What you can do:

There are steps you can take, but they may not save you money now.

1. Check to see what deals are available. Use a price comparison site and make sure you’re basing this on the energy you use/your bills, and not a wild guestimate. With so many fixed-rate deals having been pulled in the last few weeks, you may not be able to save money if you’re currently on the standard variable tariff, but it could be possible. Be aware that fixed price tariffs normally charge exit fees if you leave the deal before the term is up and these can vary quite widely. Some energy providers offer tracker deals, which will follow the energy price cap, so you’re not protected from price rises, but you should pay a little less.
2. Pay by direct debit if you’re currently paying your bill when it arrives. You’re being charged extra by paying this way. The energy price cap if you pay by direct debit will be £1,641 from April 1st, but it will be £1,772 if you pay your energy bill when it arrives.
3. If you’re having difficulty paying your gas and electricity bills, speak to your energy supplier as soon as you can. There are rules in place that say they have to try to help you pay back what you owe. They should, for example, agree a payment plan with you to help spread the cost. You can also ask for more time to pay or a break in your payments. There are also rules in place that set out when energy companies can force you to have a prepayment meter installed if you are in debt on your energy bill. They cannot force customers to have a prepayment meter if, for example, they are aged 75 or over or if they have children aged two or under. The energy company can also only install a prepayment meter if it is safe and practical (for example, you must be able to reach the meter to top it up).

Heating oil

The price of heating oil has almost doubled since before the attack on Iran. The government has announced a £50 million package of support for households on a low income that use heating oil. This is a particular problem for Northern Ireland, where a bigger percentage of households rely on heating oil. The help will be available through the Crisis Resilience Fund (which is UK-wide), which takes over from the Household Support Fund on April 1st. Local authorities can give cash payments to people who experience an unexpected expense or drop in income.

What you can do:

1. Plan ahead. Use heating oil comparison sites to see if you can find a good deal. Prices are fluctuating so you may be able to get your oil delivered when prices have fallen.
2. Compare the costs of a bigger delivery and several smaller ones. But be careful about over-ordering as you may have to pay to have the excess taken away if it won’t fit in your tank.
3. See if your oil provider offers flexible payment options so you can spread the cost.  

Council tax rise

Most households in England will see council tax rise by almost 5% from April 2026. That translates into about £100–£110 more a year for a typical Band D home, increasing the cost to £2,394 a year, on average.

In England, most councils can only increase the tax by 4.99% unless they hold a referendum or a local vote.  The majority of top tier councils in England (119 out of 153) are putting council tax bills up by 4.99%. In Wales, the average rise is 4.9%, with some bills going up by 5.5%. In Scotland there’s no cap on how much councils can increase council tax by. Rises range from 4% - 10%.

Worryingly, figures from the government released last year show that households in England owe more than £6 billion in unpaid council tax.

What you can do:

1. Check you’re claiming the council tax discounts you’re entitled to. For example, you may be entitled to pay less or no council tax if you are the only adult in the property or if you’re disabled or on a low income. If you live with someone who has a severe mental impairment, such as dementia, they may be excluded for the purposes of council tax. Your council should tell you whether you qualify for any of these.
2. Contact your council if you’re struggling to pay your council tax. If you’re not behind with your payments but money is tight and you normally pay your bill by direct debit, the council may let you pay over 12 months, if you’ve chosen to pay over ten months.
3. Try not to miss payments if you can as it could mean you’re asked to pay the outstanding bill in full.

Water bills

Water bills are rising by an average of 5.4%, that works out at £33 a year – or £2.70 a month, on average. The typical bill in England and Wales is rising from £606 to £639 a year, according to Water UK. Last year, that rise was £10 a month. The biggest increases are from some of the smallest companies, such as Bristol Water, where customers will pay 12% more, on average. In contrast, Thames Water, whose customers saw a larger rise last year, will pay just 0.4% extra this year.

In Scotland, water bills are rising by an average of £42 over the year, or £3.50 a month. However, average bills are lower than in England at £532 a year, and Scottish Water says that over half of households receive support with their bills.

Bills are rising as agreed with the water regulator, Ofwat, as part of a five-year settlement. A large proportion of the increase was front-loaded last April which is why bills rose by much more.

What you can do:

1. You may be able to save water by having a water meter fitted if you don’t already have one. As a general rule, if you have more bedrooms in your property than people living there, you may be better off with a water meter. The Consumer Council for Water has a calculator you can use to check if a water meter would be a cheaper option.
2. If you have a water meter fitted, see if you can use less water to bring your bills down.  
3. Water companies also offer social tariffs, which could reduce the cost of a bill by up to 50%. The rules on who qualifies and how much help you get varies between suppliers. For example, for Thames water, it could be a 50% reduction if your water bill is more than 5% of your income after tax. While Southern Water will discount your bill by up to 90% if you meet their criteria.

You can find out more about social tariffs and other help available on the Consumer Council for Water website.

Broadband and mobile

Millions of broadband customers will pay higher prices on April 1st, and, depending on when you took out your contract and how much broadband you use, the increase could be significant.

The regulator, Ofcom, changed the rules so that contracts taken out in the last year or so can only increase by a £ and pence figure, rather than a percentage. Some providers are increasing prices by £4 a month, others – on slightly older contracts – by £3 a month, while contracts taken out before 2024 may increase by amounts linked to inflation measures such as the RPI or CPI. The average broadband bill is approximately £35 a month, so a £4 rise would be more than 10%.

What you can do:

1. Shop around, especially if you’re out of contract. It’s really worth doing as broadband providers tend to be quite flexible with their pricing, which means you may get a saving with your existing provider if you say you’re going to leave (although this is not guaranteed). Otherwise, you may be able to get a better deal by switching.
2. Check whether you need the data you’re paying for as you may be able to save money by taking a deal with less data.
3. See if you qualify for a social tariff. Generally, these are available to you if someone in your household is getting universal credit. Social tariffs cost between £10 and £24 a month and many people who could get them don’t know about them or ask about them.

TV licence

The cost of a TV licence is rising from £174.50 to £180 a year on April 1st. That works out at £5.50 a year or 46p a month. It’s a rise of just over 3.1%.

You need a TV licence if you watch live TV – whether that’s on a TV or whether you’re streaming it live. You also need a TV licence if you watch programmes on BBC iPlayer, even if they’re on demand rather than live.

What you can do:

Support for households in severe financial difficulty is available and free licences for over-75s on Pension Credit. If you’re struggling, you may be able to pay for your TV licence fortnightly or monthly through the Simple Payment Plan. You can get a discount on the cost of a TV licence if you’re registered blind.

Stamps

The price of a first-class stamp will rise from £1.70 to £1.80 on April 7th. That’s a rise of almost 6%.  A second-class stamp will go up from 87p to 91p – an increase of almost 4.6%.

What you can do:

Buy stamps ahead of the price rise – or use email, messaging or phone calls where you would normally send a letter!

Car tax

There’s a range of changes to car tax from April 1st, including a rise in the standard car tax rate you pay after the first year for most petrol, diesel or hybrid cars registered after 1st April 2017 from £195 to £200.

Electric cars no longer qualify for free road tax, and in April 2026 drivers of electric cars under a year old will start paying the £200-a-year flat rate.

The Expensive Car Supplement (also known as the luxury car tax) threshold has increased from £40,000 to £50,000 for EV buyers. It takes effect from 1 April 2026, but also applies to electric cars registered from 1 April 2025 onwards.

As a result, if your electric car was first registered after 1 April 2025 and has a list price that does not exceed £50,000, you will not be required to pay the 'luxury car tax', which adds £440 a year and takes the total annual VED up to £640. 

Mortgages

Fixed rate mortgages are now significantly more expensive than they were before the end of February and hundreds of fixed-rate deals have been withdrawn. For someone with a £200,000 mortgage, a 0.5% rise in new fixed rate mortgage rates could cost them an extra £58 a month or £700 a year.

About 1.8 million fixed-rate deals are due to end in 2026, and most of these borrowers will need to get a new mortgage. However, mortgage brokers have warned that fixed-rate mortgage deals are being withdrawn very quickly, so if you see a competitive deal, it may make sense to move quickly.

What you can do:

1. Keep a close eye on mortgage deals. Rates are changing quickly.
2. Talk to an independent mortgage broker. They should know the market inside out and can advise you about the cheapest deal. It may not be the lowest headline interest rate.
3. Get yourself in the best position to secure the best mortgage rate. Check your credit report and get any mistakes corrected and use a ‘notice of correction’ to explain any minor issues.

Tax thresholds frozen

Not an obvious rise, but a stealth tax rise. The personal allowance will remain frozen – at £12,570. All other tax thresholds are frozen as well. This does mean more people will pay tax for the first time and more people will pay tax at the higher rate. The number of higher-rate taxpayers in the UK is projected to be 7.08 million in the tax year 2025 to 2026, which is a 38.7% increase compared to 2022 to 2023.

What you can do:

Pay more into your pension, either a one-off payment or by increasing your monthly contributions. Pension contributions get taken off the amount of income to be taxed, so they reduce the amount of tax you pay.

If you’re in a workplace pension scheme, then your employer may make pension contributions on your behalf through salary sacrifice. With salary sacrifice, you swap some of your salary in exchange for your employer paying into your pension on your behalf. You don’t pay tax or national insurance on the salary you sacrifice.