Nine big changes next month that could leave you richer - or far poorer

The end of the tax year is nearing, when a flood of new changes, as announced by the Chancellor last November, will kick in.

Among those set to be affected from 1 April will be homeowners, motorists, workers on the minimum wage and all UK employees over the age of 24 - regardless of your earnings.

For diesel drivers, the crack down on pollution continues and, if you're not careful, it could cost you a lot more than expected.

Meanwhile, for millions more inflation-hit households - the minimum wage is set to rise again.

From pensions, to benefits, taxes and bills here are the important changes that could affect your household budget from the first week of April.

1. Introduction of the Sugar Tax

On 1 April, the Government's new 'Sugar Tax' will kick in as it continues to crack down on obesity and bad health. It comes as figures show 8,000 cases of type two diabetes a year are linked to fizzy drink consumption.

Next month, all drinks with a total sugar content above 5g per 100ml will be taxed at 18p a litre, while sugary drinks with more than 8g of sugar content per 100ml will be taxed at 24p a litre.

This means if you regularly buy drinks such as Coca Cola Classic or Pepsi, you will have to pay more for the luxury.

To put these figures into perspective, right now a classic 1.75l bottle of Coca Cola costs around £1.66.

With a sugar content of 10.6g per 100ml it will be hit with the higher rate of the tax, meaning it'll rise to an extra 42p per bottle.

If you prefer to go for a 330ml can, then you’re looking at paying around an extra 8p on the typical 70p cost.

2. New car tax rules

New car tax rules due to kick in next month could also hit thousands of drivers hard.

The changes, introduced as part of efforts to cut back on toxic fuel, could end up costing diesel motorists anything from £20 to £500 more a year.

On April 1, ALL new cars that don't meet new emissions standards will be pushed up a tax band for the first year on the road. This means more expenses for you.

This is because diesel cars are the highest producers of toxic gases on our roads in the UK - and the dangers have been linked to heart disease and lung cancer.

Importantly though, the new rules will only apply to new cars bought and registered after the April date.

If you currently own a diesel car and it was registered before that date then you will pay your current car tax rate.

3. Minimum wage increases

 Hot on the heels of employers being ‘named and shamed’ for underpaying staff , the minimum wage is set to rise on 1 April.

On this date, the National Living Wage, the minimum rate for workers aged 25 and over, will jump to £7.83 an hour.

Simultaneously, the minimum wage for all other workers will also go up - including apprentices who will see their rates rise 5.7% from £3.50 to £3.70 per hour.

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According to chancellor Philip Hammond, the rise will leave full time workers on the basic rate £600 better off a year. For over-25s, it's an extra £50 a month - or 33p extra an hour.

The move is a welcome one for many workers, but with inflation peaking, is it good enough?

The Living Wage Foundation - a non-government organisation - sets its own rates based on the rising cost of living. It says staff should be paid at least £8.75 an hour or £10.20 if you live in London.

The changes kick in on 1 April (Easter Sunday) and should show up in your next pay slip. 

4. Energy bills to rise for 5 million people

Energy bills are rising on Easter Monday, when five million customers will see their bills go up by £57 a year.

That's because the energy price cap for safeguard and prepayment tariffs is set to rise by 5.6%, in reflection of rising wholesale costs which are expected to rise further in the Spring.

This was the tariff initially introduced to help protect low-income households, many of whom are on pre-pay meters. It also includes one million households who currently receive the warm home discount.

However from April, the cap will increase from £1,031/year to £1,089/year based on typical use.

This could affect about four million prepayment customers and a further one million vulnerable customers on standard credit meters.

If you're on this tariff, Which? says you shouldn't stand for it. There are plenty of fixed price deals available that are actually cheaper than the safeguard tariff.

Consumer body uSwitch also adds that even those on pre-payment meters may find it cheaper to swap to a credit meter instead.

Claire Osborne, energy expert at uSwitch.com, said: "Unfortunately, price caps can't prevent prices from rising, which is why it's always important to run a comparison to make sure you're on the best deal for you.

"If you are on a prepayment tariff it could be worth shopping around to see if you can save money by moving to a fixed deal, there are currently savings of up to £116 on offer."

You may also be able to cut your usage.

5. Auto-enrolment contributions to rise

Alongside wages, the monthly amount you contribute towards your workplace pension (from your pay slip) is set to rise on 1 April - up from 1% to 3%.

This means four million workers will see their take home pay go down - to the tune of £540 a year for the average earner - but it's actually GOOD news, as when you hit retirement, you'll be able to unlock the savings pot.

Auto-enrolment is compulsory for employers, but not for workers, so if you want to opt out, you can after the first month of being on the scheme.

To do this, you'll have to tell your pension provider who'll then refund you everything you've put in so far.

But, think very carefully before you decide, as opting out also means waving goodbye to all of that free money from your employer's contributions.

6. Your Personal Allowance is going up

The Personal Allowance - the amount you can earn before having to pay tax - is rising on 1 April to £11,850.

That's £350 more than the current allowance of £11,500.

This means for the next tax year, you'll be able to earn up to £11,850 without being liable for income tax - a move that could leave basic rate (20%) taxpayers £70 better off a year.

But the real winners are the better off - with the higher rate threshold - where you start paying 40% tax - rising to £46,350 a year. This means richer people will be £270 better off - on top of the £70 everyone else gets.

“Increasing the higher rate tax threshold to £46,350 means more people should pay less income tax from next April. Some will move out of the higher rate tax bracket and become basic rate tax payers," said Kate Smith, head of pensions at Aegon.

7. Mortgage holders

From 5 April, the Support for Mortgage Interest (SMI) benefit for homeowners who struggle to keep up with their monthly payments will see some big changes.

These payments cover interest on mortgages and are paid directly to the lender on behalf of the customer. Currently, 124,000 people benefit from it a year.

However, in April it's being replaced by a loan or "second mortgage".

This must then be repaid when the house is sold or when the claimant's entitlement to the benefit comes to an end.

The amount owed will also increase with interest, while payments will change to a month in arrears, like Universal Credit.

8. Council Tax

It's not just energy bills that are set to go up next month - Council Tax is about to leap too.

In fact, 95% of councils plans to increase tax by 6% a year - you can check how much more you will be paying in the widget below.

A 6% rise would see the annual council tax cost for a typical property jump by £95 to £1,686.

However, there are a host of quirks to the way that council tax works which can result in a reduced monthly payment.

9. Relief for graduates earning over £21k

Last year, the Government announced that tuition fees would not rise this year, but there are a few important changes that new, previous (post-2012) and existing students need to know about.

Firstly, as of next month, graduates will not have to start repaying loans until they are earning more than £25,000.

At the moment, you must repay 9% of everything you earn above £21,000.

However, from 6 April, that threshold if being raised to £25,000.

This means if you graduated after 2012, and are currently earning exactly £25,000, you'll no longer have to pay tax on the £3,999 you're currently paying it on. In short, you'll be £30 better off a month or £360 a year.

In a written statement, universities minister Jo Johnson said: "The earnings threshold will be increased from April 6 2018. From its current level of £21,000, the threshold will rise to £25,000 for the 2018-19 financial year. Thereafter it will be adjusted annually in line with average earnings.

"The new threshold will apply to those who have already taken out and will take out loans for tuition and living costs for full-time and part-time undergraduate courses in the post-2012 system, and those who took out or will take an advanced learner loan for a further education course."

Elsewhere, part-time undergraduate students will also be entitled to maintenance loans for the academic year 2018-19 to support the cost of living while studying for the first time. - UK Mirror