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Edinburgh Live

World

Linda Howard & Alexander Smail

Every important financial change affecting millions of people in April

DWP Council Tax Martin Lewis Scotland Guardian Allowance HMRC Post Office Royal Mail United Kingdom GovUK

There will be a number of significant financial changes coming into effect this month, which will affect households across Scotland and the UK.

Other than the energy price cap increase, there will be an increase to benefits from the Department for Work and Pensions (DWP) and HM Revenue and Customs (HMRC), as well as rises to the National Living Wage, Council Tax and National Insurance Contribution deductions.

In addition, all Scottish households in bands A to D will have a £150 Council Tax Energy Rebate, with those on higher bands already receiving a reduction on their annual bill.

Further, amid the worsening cost-of-living crisis, prices on everyday items such as groceries have also risen.

As reported by the Daily Record, here is a breakdown of the main financial changes coming into effect this month.

Stamps

Earlier in 2022, financial guru Martin Lewis revealed that starting January 31, 2023, millions of Royal Mail first and second class stamps with the Queen's head will be replaced with ones that have a bar code alongside it.

Lewis stated that, starting March 31, people who have any older stamps will be able to exchange them for the new barcode ones.

The 'Swap Out' scheme, begins today and runs right through to March 31, 2023 — giving people plenty of time to replace their old stamps.

Lewis said: “You can get a form on the Royal Mail website or you can call it or go somewhere that has Royal Mail delivery, but bizarrely, you can’t do it at the Post Office - which I think needs to change - and then you need to post your tamps off and they’ll send you replacements.”

Another point to consider is that the price of first and second class stamps will rise from April 4.

The former will go up by 10p to 95p, while the latter will rise by 2p to 68p.

Energy bills increase

Families across Scotland and the UK are preparing to manage the impact of Ofgem’s 54% price cap hike, which will begin on April 1.

The simplest way to help costs as low as possible is to limit your usage, which will hopefully be easier moving into spring and summer.

Starting today, the price cap will increase from £1,277 to £1,971 for a household on a standard tariff with typical, average usage — a rise of £693 a year.

Meanwhile, prepayment meter customers will see an increase of £708 from £1,309 to £2,017.

The energy price cap refers to the limit energy firms can charge their customers for gas and electricity.

Council Tax bill increase

New Council Tax bills for 2022/23 have been issued and certain customers who are eligible for a £150 energy rebate should have heard from their local authority to tell them how it will be administered.

If you’re not sure if you’ve received it and you’re in bands A to D, or currently receive a discount/reduction - contact your local council.

National Insurance Contributions are rising

Starting April 6, employer and employee National Insurance contributions will rise, reverting to its 2021/22 level the following year, and the income stream replaced by a new health and social care levy of 1.25%.

This is expected to raise approximately £12 billion per year, which will be used to fund the NHS, Health and Social Care Levy across the UK.

How much will I pay under the new plans?

What you pay in NICs is dependent on your salary — however, those who earn less than £9,568 do not have to pay and will not have to pay the new levy.

Salary and new National Insurance Contributions

£20,000 - will pay an extra £130 a year (£10.80 per month)
£30,000 - will pay an extra £255 a year (£21.25 per month)
£50,000 - will pay an extra £505 a year (£45.80 per month)
£80,000 - will pay an extra £880 a year (£73.33 per month)
£100,000 - will pay an extra £1,130 a year (£94.16 per month)

You can learn more in the new Build Back Better: Our Plan for Health and Social Care document on the GOV.UK website here.

National Living Wage increase

The National Living Wage refers to the minimum rate workers 23 or older need to be paid for each hour of work — meaning that those over 23 are legally entitled to receive the National Living Wage.

It was previously £8.91 per hour, but has risen by 59p to £9.50 — a 6% increase.

This is equivalent to an additional £1,074 per year before tax, or £90 more each month.

Chancellor Rishi Sunak said that the rise will “benefit over 2m of the lowest paid workers in the country”.

National Minimum Wage increase

If you’re under 23, you are only entitled to the National Minimum Wage.

Wage increases from April 1:

Apprentice - £4.81
Under 18 - £4.81
18 to 20 - £6.83
21 to 22 - £9.18
23 and over - £9.50 (National Living Wage)

Water bills rising

As reported by The Mirror, water and sewerage prices in Scotland is dependent on Council Tax band, and are covered by what's called a ‘combined service charge’.

Households in Scotland will see these water and waste charges increase by an average of 4.2% from April.

Post Office Card accounts closing

HM Revenue and Customs (HMRC) has been warning customers for more than a year that Working Tax Credits, Child Tax Credits, Child Benefit and those claiming Guardian’s Allowance will no longer have benefits paid into a Post Office card account after April 5.

More than 6,800 customers have still to contact the relevant department and make alternative arrangements for payments - all you have to do is give them your new account details.

Anyone who hasn’t submitted new account details by April 5 will see their payments paused - find out more about this here.

Social Security Scotland benefits going up by 6%

The Scottish Government will increase the Scottish Child Payment from £10 per week to £20 from April 1.

There are also several other increases to devolved benefits, but the new Adult Disability Payment which will replace Personal Independence Payment (PIP) this year and the Child Disability Payment, which replaced Disability Living Allowance for Children, will rise by 3.1% - in line with the DWP uprating to prevent a two-tier benefits system in Scotland.

Payment rates for 2022/2023

Best Start Grant

Best Start Grant Pregnancy and Baby Payment (1st Child Payment) - £642.35 (from £606)
Best Start Grant Pregnancy and Baby Payment (Subsequent Child Payment and Extra Payment for Twins/Triplets) - £321.20 (from ££303.00)
Best Start Grant Early Learning Payment - £267.65 (from £252.50)
Best Start Grant School Age Payment - £267.65 (from £252.50)

Child Winter Heating Assistance (annually) - £214.10 (from £202)

Funeral Support Payment

Standard rate for other expenses element - £1,070.60 (from ££1,010)
Other expenses element where there is a funeral plan - £130.65 (from £123.25)
Removal of implanted medical devices - £21.55 (from £20.55)

Job Start Payment

Job Start Payment (one-off) standard rate - £267.65 (from ££251.25)
Higher rate - £428.25 (from ££404)Young Carer Grant

Young Carer Grant (annually) - £326.65 (from £308.15)

Carer’s Allowance Supplement - £9.45 (from £8.90)

Adult Disability Payment - same as PIP uprating of 3.1%

Daily living

Standard rate - £61.85 (from £60)
Enhanced rate - £92.40 (from £89.60

Mobility

Standard rate - £24.45 (from £23.70)
Enhanced rate - £64.50 (from £62.55)

Child Disability Payment - same as DLA for Children uprating of 3.1%

Care Component

Highest Rate - £92.40 (from ££89.60)
Middle Rate - £61.85 (from £60)
Lowest Rate - £24.45 (from £23.70)

Mobility Component

Higher Rate - £64.50 (from £62.55)
Lower Rate - £24.45 (from £23.70)

You can view the full document on the Social Security Scotland website here.

DWP benefits going up by 3.1%

From April 11, benefits delivered by the DWP will increase by 3.1%

New DWP payment rates from 2022 to 2023

Weekly rates are shown, unless otherwise stated.

Attendance Allowance

Higher rate: £92.40 (from £89.60)
Lower rate: £61.85 (from £60.00)

Carer’s Allowance

April 2022 rate: £69.70 (from £67.60)

Disability Living Allowance

Care Component

Highest: £92.40 (from £89.60)
Middle: £61.85 (from £60.00)
Lowest: £24.45 (from £23.70)

Mobility component

Higher: £64.50 (from £62.55)
Lower: £24.45 (from £23.70)

Employment and Support Allowance (ESA)

Under 25: £61.05 (from £59.20)
25 or over: £77.00 (from £74.70)

Housing Benefit

Under 25: £61.05 (from £59.20)
25 or over: £77.00 (from £74.70)
Entitled to main phase ESA: £77.00 (from £74.70)

Incapacity Benefit (long-term)

April 2022 rate: £118.25 (from £114.70)

Income Support

Under 25: £61.05 (from £59.20)
25 or over: £77.00 from (£74.70)

Jobseeker’s Allowance (contributions based)

Under 25: £61.05 (from £59.20)
25 or over: £77.00 (from £74.70)

Jobseeker’s Allowance (income-based)

Under 25: £61.05 (from £59.20)
25 or over: £77.00 (from £74.70)

Maternity/Paternity/Shared Parental Allowance

Standard rate: £156.66 (from £151.97)

Pension Credit

Single: £182.60 (from £177.10)
Couple: £278.70 (from £270.30)

Personal Independence Payment (PIP)

Daily Living Component

Enhanced: £92.40 (from £89.60)
Standard: £61.85 (from £60.00)

Mobility Component

Enhanced: £64.50 (from £62.55)
Standard: £24.45 (from £23.70)

State Pension

Full New State Pension: £185.15 (from £179.60)
Basic Old State Pension (Category A or B): £141.85 (from £137.60)

Widow’s Pension

Standard rate: £126.35 (from £122.55)

Statutory Parental Bereavement Pay

Standard rate: £156.66 (from £151.97)

Statutory Sick Pay

Standard rate: £99.35 (from £96.35)

Universal Credit (Monthly rates shown)

Standard allowance

Single

Single under 25: £265.31 (from £257.33)
Single 25 or over: £334.91 (from £324.84)

Couple

Joint claimants both under 25: £416.45 (from £403.93)
Joint claimants, one or both 25 or over: £525.72 (from £509.91)

Child Elements

First child (born prior to 6 April 2017): £290.00 (from £282.60)
First child (born on or after 6 April 2017) or second child and subsequent child (where an exception or transitional provision applies): £244.58 (from £237.08)

For the full list of proposed DWP increases to benefits and State Pension, visit the GOV.UK website here.

Child Benefit and Guardian's Allowance payments are rising

These benefits are delivered by HMRC.

Child Benefit payment rates for 2022/23

There are two Child Benefit rates in place.

Current rates per week

Eldest or only child - £21.15
Additional children - £14.00

New rates per week - from April 2022

Eldest or only child - £21.80
Additional children - £14.45

How much is the increase?

This is an increase of 65p and 45p respectively per week and means the new, regular four-weekly payments will be £87.20 for an eldest or only child and £56.00 for any additional children.

Over the next financial year, this means parents will receive an additional £33.80 and £23.40 respectively.

Guardian's Allowance rates from April

The new weekly rate for Guardian's Allowance will be £18.55 - an increase of 55p on the current 2021/22 rate of £18.00.

Tax Credits

HMRC confirmed that Tax Credits payments will be changing in April for all benefits claimants.

People receiving Working Tax Credits and Child Tax Credits payments will see the maximum annual rates increase for the 2022/23 financial year which starts on April 6.

Depending on your household circumstances, you may be eligible for one or both payments, or you may also qualify for one of two types of disability element add-ons. However, it’s worth noting these are for existing claimants already receiving the legacy benefit and any new claims should be made through the DWP for Universal Credit.