How to save up to £200 on your energy bills in five minutes
ENERGY bills are set to rise in just a few weeks for households on standard tariffs but you could save up to £200 by switching ahead of the hike. The energy regulator Ofgem has upped the maximum price suppliers can charge from April 1 for electricity and gas from £1,042 a year to £1,138. It […]
ENERGY bills are set to rise in just a few weeks for households on standard tariffs but you could save up to £200 by switching ahead of the hike.
The energy regulator Ofgem has upped the maximum price suppliers can charge from April 1 for electricity and gas from £1,042 a year to £1,138.
It sets the price cap twice a year to limit how much suppliers can charge customers on standard variable tariffs, depending on wholesale prices.
The standard or default tariff is the rate households are automatically moved to once their deal with an energy company ends.
It is typically more expensive than a fixed rate tariff and if you don’t switch you will be stuck paying the higher price.
Analysis by The Sun, based on a household with medium energy usage, found there is a price difference of more than £200 between the new maximum default tariff charge and the cheapest deal on the market.
The lowest fixed tariff, according to a search on comparison website Energylinx is currently £926.33 per year from Eon.
This is £212 cheaper than a standard tariff under the maximum price cap.
Providers often raise the price of their default tariff in line with the cap.
British Gas, Scottish Power, EDF, and EOn have all confirmed that prices on their default tariff will rise.
Consumer watchdog Which? said the cap rise could hit 7 million customers.
It has analysed what a default tariff will cost from next month based on providers that have confirmed increases and compared it with the price of each company’s cheapest deal.
The analysis, run by Energylinx earlier this month and based on a medium energy usage household, found bills could be cut by up to £200 a year by moving off a default tariff and onto the cheapest rate from the same provider.
The largest saving was with British Gas, where its cheapest fixed tariff was found to be £203 cheaper than its default rate.
Households could also save £191 by switching from Eon’s standard tariff to its cheapest deal or £185 with Scottish Power.
How to switch from a default tariff
Everyone is moved to a standard tariff once their energy deal comes to an end.
It is often hundreds of pounds more expensive than a fixed rate so it is important to switch so you can save money.
Your energy company is supposed to tell you if you can save money on your gas and electricity.
Check your bill each month as it should include a section showing if you could save by moving to a different tariff with the same provider.
How to claim tax back on energy bills when working from home
TAX can be claimed back on up to £6 a week to help cover the additional costs of working from home, such as higher energy bills.
Prior to April 6 when the new financial year began, tax could be claimed back on expenses of up to £4 a week.
For those paying the standard tax rate of 20%, £1.20 per week can be claimed.
While for people who pay tax at the higher rate of 40%, £2.40 per week can be claimed.
Additional rate tax payers who pay 45% can claim £2.70 a week.
To claim tax back on working from home costs complete a P87 from online.
It’s fairly straightforward with a Government Gateway account which you may already have or you can set up, or you can complete a paper P87 form.
In the section called “using your home as an office”, you’ll be asked to enter the amount you paid.
You won’t have to show receipts or prove this is how much you spent.
You’ll also be asked to enter the amount repaid by your employer. This will be zero if you haven’t been reimbursed.
If you have been reimbursed you can’t claim back the tax – your employer has already included this.
You usually get the money back by paying less tax, rather than receiving a refund. Your tax code may be adjusted to show this.
The time it takes for this to happen can vary and there are likely to be a larger number of claims than usual so there could be delays.
You can arrange a switch through your existing supplier either on their website or on the phone.
It can take a matter of minutes once you have all the required information.
You will be asked to provide a meter reading and details of your energy usage per year or month.
This could be how much you pay or the actual usage known as the kilowatt hour (kWh).
Your latest energy bill will contain this information.
You will also need to provide your postcode and will then be shown a range of new tariffs you can swithc to and what the monthly cost will be.
There is no need to stick with your existing supplier though especially as there won’t be any exit fees for leaving a default tariff.
Ofgem estimates that households can save on average £150 per year by switching to a fixed rate tariff.
You can compare several deals at once using your energy information and postcode through comparison websites such as Energylinx, uSwitch or MoneySuperMarket.
They will often manage the switch for you and you will just need to provide your supply address and bank details.
A switch usually takes around 20 days to complete so you need to act fast to beat the April 1 price hike.
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