Budget 2026: What It Means for Your Household Bills

The Budget on 28 October 2026 kept VAT off domestic electricity in Great Britain until 1 July 2027, which HM Treasury expects to take around £50 off Ofgem's April 2027 price cap. It added a one-off £100 Household Energy Payment for council tax bands A to D in England from January 2027, and asked Ofgem to abolish gas standing charges, aiming for the end of 2027. It did not change council tax bands, the TV Licence, or water and broadband bills. Everything below was read in the Budget documents on GOV.UK on 28 October 2026.

What changes for household bills?

Sources: HM Treasury, Budget 2026, its policy costings and the Your First Home guidance.

Will electricity bills go up when VAT returns?

Not in April any more. The Budget extends "the temporary 0% rate of VAT on qualifying domestic electricity supplies in Great Britain for another three months, until July 2027", and the policy costing gives the period as 1 October 2026 to 1 July 2027. Ofgem's April to June 2027 cap period falls wholly inside the extension. HM Treasury expects the extension to take around £50 off the annual cap in April 2027, based on the average of suppliers' published forecasts.

Two things to know:

• HMRC's guidance has not caught up yet. Its policy paper still said 31 March 2027 when we read it at 13:45 on 28 October.
• Northern Ireland: the Budget funds the Northern Ireland Executive to give comparable support and says extended VAT relief is expected to apply there from April 2027. No detail has been published.

Gas stays at 5% VAT. Our electricity VAT guide covers fixed tariffs and how to check the VAT line on a bill, and our April 2027 forecast shows what suppliers expect the cap to be.

Who gets the £100 Household Energy Payment?

Households in council tax bands A to D in England: up to 20 million homes, around 80% of households there, says HM Treasury. Councils pay it through the council tax system from January 2027, and the Budget's summary says the money goes directly into bank accounts. Councils also get £100 million for targeted help, including some households in higher bands. Scotland, Wales and Northern Ireland receive a share of the funding to provide similar support.

The rules on the qualifying date, claims and people who move have not been published. Our Household Energy Payment guide covers what is known, what happened with the 2022 rebate and how to check your band.

What happens to gas standing charges?

The government has asked Ofgem to abolish gas standing charges on domestic bills in Great Britain, "aiming for delivery by the end of 2027 or as soon as possible after then". The Budget puts the charge at £108 a year on average for a typical household today. Suppliers will recover the same costs through the gas unit rate instead, so:

• homes that use little gas pay less, because they stop paying a fixed charge for a connection they barely use;
• homes that use a lot of gas may pay more, because each unit carries part of the cost;
• HM Treasury estimates around 60% of account-holding households would save about £45 a year on average, and says it will set out targeted help for households that lose out.

Nothing changes on bills yet, and electricity standing charges are to be reformed with details next year. Our standing charges guide explains how they are set today.

What else changes for energy bills?

• No new policy costs: until a Cost Control Framework is in place at the 2027 spending review, the government says no further policy costs will be added to bills unless they bring bills down or are essential for security of supply.
• No hydrogen levy: the Gas Shipper Obligation, a planned new charge on gas bills, will not be introduced; the government will fund hydrogen contracts instead.
• Energy debt: a new strategy with Ofgem includes a one-off targeted debt relief scheme, which Ofgem aims to launch in spring 2027 after another consultation; our Debt Relief Scheme guide has the detail. The government expects the strategy to save a typical household almost £30 by 2030.
• Fuel duty: the 5p cut is extended to 1 July 2027, when rates rise by 5p and with inflation.

What does the Budget mean if you are buying or renting a home?

• Your First Home: first-time buyers in England can borrow 20% of a new-build home's price from the government, interest free for five years, with a deposit from 2.5%. It applies to household incomes up to £110,000, or £140,000 in London, and homes under a local price cap (for example £355,000 in Manchester and £650,000 in inner London). Pre-registration opens by the end of 2026, applications in February 2027 and the first loans in April 2027. Our Your First Home costs guide adds the bills the government's example leaves out.
• Lifetime ISA: from 29 October 2026 the charge for using the savings on a first home above £450,000 falls from 25% to 20%. A new First Time Buyer ISA replaces it for new savers from April 2029.
• Landlords: income tax on rental income rises by a further 2 percentage points from 6 April 2027. The Budget says nothing about rents.
• Moving into a home: alongside the Budget, Ofgem opened a consultation, open until 9 December 2026, on guidance for suppliers that may switch a smart meter to pay-as-you-go when the last occupier has left and nobody has registered, with a grace period for the new household. The government's energy debt strategy also plans a law requiring landlords to tell suppliers when tenants move in or out. Contacting the supplier on the day you move in avoids both.

GOV.UK's Your First Home example of monthly costs leaves out council tax, service charges and maintenance, and the guidance tells buyers to weigh them before applying. A new-build may not have a council tax band when you move in: our new-build bills guide and buying a house bills guide set out the running costs to add.

What did the Budget leave unchanged?

• Council tax: nothing on bands, the 25% single person discount or the limits on rises; last year's limits came with the provisional local government settlement in December. The High Value Council Tax Surcharge for homes worth £2 million or more still starts in April 2028; the Budget confirmed a deferral scheme, discounts, exemptions and a 100% premium on homes empty for 12 months or more. Our council tax rise guide tracks April 2027.
• TV Licence, water and broadband: no measures.
• Warm Home Discount and Winter Fuel Payment: no changes announced. Our winter energy bill help lists every scheme with its dates.

What happens next?

• 29 October 2026: the lower Lifetime ISA charge applies from midnight.
• 25 November 2026: Ofgem announces the cap for January to March 2027.
• By the end of 2026: pre-registration for Your First Home.
• January 2027: councils in England start paying the £100 Household Energy Payment.
• 23 February 2027: Ofgem announces the cap for April to June 2027.
• 1 July 2027: VAT on domestic electricity is due to return to 5% unless it is extended again.
• End of 2027, or as soon as possible after: gas standing charges are due to go.

Where Taupia fits

Taupia does not pay or apply for any of these schemes. Its address check shows the council tax band and the council's charge for that band this year for an exact address in England, Scotland and Wales, and the move-in plan lists the energy supplier, water company and broadband for the same home. Taupia is free, and nothing changes without your approval.