Martin Lewis warns bill payers to switch energy deals NOW to save £100s

MARTIN Lewis is urging bill payers to switch energy deals now to save hundreds of pounds a year.

The warning comes as wholesale energy prices have surged to their highest levels since 2018 as demand increases after lockdown.

Outages at old power plants plus a low level of gas in storage has also led to a sharp rise in the cost of the cheapest tariff.

The consumer guru highlighted the issue in his latest MoneySavingExpert tips newsletter.

Switching tariffs will mainly benefit those who are currently paying for their supplier's standard variable rate deal.

Customers tend to roll onto these tariffs when their deal has come to an end and are typically more expensive than a fixed contract.

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.

On average, households on a dual-fuel standard variable rate tariff are paying £1,138 a year for their energy, according to MSE.

Comparison site warns that 218,499 households are at risk of being automatically moved on the more expensive tariff when their deal ends this month.

This could push bills up by £279 a year per household on average.

Peter Earl, head of energy at the comparison site said: "Each month hundreds of thousands of households risk falling onto a standard variable tariff which means many end up paying more than they should do.

"Energy companies are the only ones to benefit. The good news is that customers do not have to take these price increases lying down."

How to save £100s on energy bills

The easiest way to save cash on your bills is to switch energy deals to one with a better rate.

MSE's Pick Me A Tariff tool can help you find a cheaper deal – so can comparison sites like USwitch, CompareTheMarket and MoneySupermarket.

However, it's worth noting that if you're still tied into your current deal you may face forking out an early exit fee to switch before it ends which will eat into any savings you make.

The cheapest one-year fixed rate deal for dual energy is currently with Avro, at £975 a year.

MSE reckons it would save bill payers £163 a year compared to staying on the average standard variable rate tariff.

The cheapest longer-term fixed deal is with Pure Planet at £1,026 a year for gas and electricity.

The deal is fixed for 16 months and it could save households £112 a year.

Martin also points out that while fixed rate deals have soared, variable rates are still cheap and could save bill payers even more cash.

However, he warned: "Fixes give you rate certainty, but currently you pay a premium for them. Variable deals are much cheaper right now, but you risk prices rising.

"For those willing to switch again if they rise, they're a decent bet, as there are no early exit penalties – the main risk is the choice being worse when you compare again."

But he added that it's best to stick with a fixed deal if you prefer certainty as you may have to swap deals again if yours rises too much.

It's easy to switch deals as the provider does most of the leg work for you – only the provider and price will change for you.

An auto-switching tool, such as Switchd or Look After My Bills, can actually help to move you to a cheaper tariff when yours comes to an end, without you having to do the legwork.

You won't be cut off during the process and someone will only visit your home if you want a smart meter.

Over one million families are to get a payout after energy giant E.ON took customers' direct debits unexpectedly early.

In April, thousands of SSE customers woke up to shock readings from their smart meters showing bills of up to £42,000.

On Sun reader told of how she's forced to pay an extra £250 a year for water and energy just because she lives in Cornwall.


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