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The average UK household can expect a yearly increase of nearly £270 to household bills, latest figures show, as 2025 looks set to be difficult year for personal finances.

Kicking off with the 1 January increase to the energy price cap, a number of bill rises are set to come in throughout the year. Most will begin from April, which is likely to be a difficult month for most struggling households.

Increases to water bills and council tax will have the biggest impact in the month. And with some households shaping up to pay hundreds more, it’s important to know what to expect.

Here’s are the biggest bill rises coming in 2025:

Energy bills

From 1 January, gas and electric bills increased for millions of households in the UK as Ofgem increased its energy price cap. The 1.2 per cent increase means that the average household will be paying £1,738 a year in energy bills, up £21 from October to December last year.

The new increased figure came after the major 10 per cent uptick in October. Analysts at the trust Cornwall Insight now forecast the cap will rise again in April by 3 per cent, up another £46 to £1,784.91.

This would mark a £67 rise for energy bills overall in 2025, which could go up or down with the price cap announcements in July and October.

Water bills

Water bills are set to rise by £86 on average in 2025 following regulator Ofwat’s price review. This marks the first stage of a 36 per cent increase in bills over the next five years. However this has been frontloaded, meaning the steepest single year rise in will come in April 2025.

Ofwat said the increase would pay for a £104 billion upgrade of the water sector to deliver “substantial, lasting, improvements for customers and the environment”.

Exactly how much a households water bill will rise varies from region to region. Southern Water customers will experience the biggest bill rise of all 11 water and wastewater companies. Wessex Water customers will see the lowest increase with a 21 per cent bill rise over the period.

Council tax

Another spiralling cost, council tax will rise by £108 on average in April after Labour confirmed bills will be allowed to rise by a maximum of 4.99 per cent.

This means that households will see rises of around two times higher than the current inflation rate. The increases could raise an additional £1.8bn for councils in 2025-26, communities minister Matthew Pennycook has said.

Technically, the cap has remained at 2.99 per cent in recent years, with an extra 2 per cent permitted for councils with social care responsibilities. This accounts for 152 out of 317 councils.

It’s likely many local authorities will opt to raise council tax by the full 4.99 per cent in 2025, as 95 per cent of eligible councils did this year.

TV licence fees will also go up in line with inflation, meaning the cost of a standard colour TV licence will go up £5, increasing from the current £169.50 to £174.50.

Taken all together, these bill increases add up to an extra £266 for the average household by the end of 2025 – and possibly even more.

For the latest cost of living advice and personal finance tips as 2025 kicks off, visit The Independent’s regularly updated guide.

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