Paul Lewis: July money news
Falling gas and electricity prices, changes to wills, more pensioners paying tax and why you might be due a payout.
Image credit: GettyImages/Zhanna Danilova
Falling gas and electricity prices, changes to wills, more pensioners paying tax and why you might be due a payout.
Tens of thousands of women (and some men) who claimed child benefit for a child under 16 between 1978 and 2010 could have been paid too little state pension.
If they currently get a reduced pension, then it is possible the government owes them a share of an estimated £1 billion underpaid because it did not count what is called "home responsibilities protection" for years when they claimed child benefit.
The government wrote to 370,000 people it thought may be entitled but barely one in ten responded, so it is now looking for others who may qualify. Check if you're eligible at gov.uk. It is worth doing as the average payment made so far has been over £8,000.
The price cap on electricity and gas fell from 1 July. The average cut is stated as 7% or £129 a year, but that is misleading as it refers to average consumption and over one year – even though the cap will change again in October.
In fact, electricity costs are only down around 4.5% – the standing charge falls by 4.5% to 51.4p a day and each unit used by 4.8%. The gas standing charge falls by 8.7% to an average 29.8p a day and units by 9.4%.
But those figures are different for the eight million who pay their bills quarterly. There is almost no reduction for them in standing charges, and they pay more for each unit used. If you pay quarterly, change now to save money.
There's more advice about the best ways to cut your energy bills from Saga Money.
The Law Commission advises the government on improving the law in England and Wales. Its latest report proposes major changes to the Victorian law about wills. It recommends:
The government has not said if it will make the changes – or when.
Find out more about when to update your will and whether DIY wills are worth it.
New figures show that more than a million people over pension age are paying higher rates of income tax. The number – a record high – has nearly doubled since previous governments froze the income at which higher rates begin – £50,270 outside Scotland.
The total number of pensioners paying any tax on their income has also risen to a record 8.8 million this year – 25% up on 2021. That number will continue to rise because the basic threshold remains frozen at £12,570 until at least April 2028.
Saga Money has more information about how pensions are taxed.
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With the start of the new financial year on 6 April, our money expert explains the changes to your pension, benefits and taxes.
