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What families need to know about money changes this April

March 26, 2026

April brings a fresh wave of financial changes that will affect families across the UK. From rising household bills to increases in Child Benefit and wages, here’s a simple, family‑friendly guide to what’s happening from April 2026.

Tax & National Insurance: What it means for your take home Pay

  • Income tax thresholds are staying frozen- The Personal Allowance remains at £12,570, meaning more of your income may fall into a higher tax band if your wages have increased.
  • National Insurance updates
    • Employees: 8% NI on earnings between £12,570 and £50,270, and 2% above that.
    • Self‑employed parents: Class 2 NI is abolished; Class 4 NI is 6% on mid‑range earnings and 2% above £50,270.

While your income tax rate isn’t rising, frozen thresholds mean many families may feel their take‑home pay isn’t stretching as far.

  • Wage Increases: Good news for working parents- From 1 April 2026, the minimum and living wage rise:
    • National Living Wage (21+): £12.71 per hour
    • 18–20 year olds: £10.85 per hour
    • Under 18 / Apprentice: around £8.00 per hour depending on age and category

This is welcome news for parents and older teens working part‑time, helping to cushion rising costs elsewhere.

Child Benefit & other family benefits are increasing- Child Benefit weekly amounts rises automatically from 6 April

  • First child: £26.05 to £27.05
  • Additional children: £17.25 to £17.90

This makes a noticeable difference for families with multiple children.

Other benefit increases

  • State Pension:
    • New State Pension: £241.30/week
    • Basic State Pension: £184.90/week
  • PIP, Universal Credit, Attendance Allowance, and Carer’s Allowance are also increasing.

This will particularly help households with disabled children, carers, or multi‑generational families.

Household Bills: Costs going up (and down)

  • Council tax- Most households will see bills rise by nearly 5% from 1 April. Many families can expect annual increases of over £100.
  • Water bills- Average increases:
    • England & Wales: +£33 (annual bill ~£639)
    • Scotland: +£42 (annual bill ~£532)
  • TV Licence- Rises to £180 per year (an extra £5.50)
  • Car Tax
    • Standard rate rises to £200 per year
    • Electric vehicles begin paying car tax for the first time
  • Energy bills: Good news here: The energy price cap drops 7%, bringing the average annual household bill to £1,641. This should offer a bit of relief—especially helpful for larger families.

What This All Means for Families

For most UK families, April 2026 brings a mix of challenges and support:

  • Costs are rising- Council tax, water, TV licences and car tax all go up, putting more pressure on monthly budgets.
  • But support is increasing too- Child Benefit rises, wages increase, and many benefits get a boost—helping families manage day‑to‑day living costs.

Low‑income and single‑income families may benefit the most from increased support, while middle‑income households may feel the pinch from frozen tax thresholds and rising bills.

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