Chancellor John Healey delivered the UK's Autumn Budget on Wednesday, October 28, the first major fiscal statement of Andy Burnham's government. Among the announcements was a £100 “Household Energy Payment” for council tax bands A, B, C or D, alongside a lesser-known temporary measure: the removal of VAT from household electricity bills, saving households an average of £45 a year.
VAT cut extended until July 2027
The Department for Energy Security and Net Zero confirmed in an official statement on Wednesday that VAT on household electricity bills was removed on October 1. “We're extending that VAT cut until July 2027 to continue giving breathing space to households on their bills,” the department said.
The department added: “But we also need to tackle the root causes of high energy costs. That means building more homegrown, clean energy so that expensive gas sets the price of electricity less often, reducing Britain's exposure to volatile international gas markets.”
How to claim the £100 payment
Most households will not need to take any action. Those who pay council tax by Direct Debit will receive the £100 automatically in the same bank account their council already holds. Households that do not pay by Direct Debit, such as by cash, cheque or bank transfer, will be contacted by their council with steps to provide bank details securely or access the money through another route, such as a voucher or online portal.
Who gets the £100 and what about bands E to H
The £100 payment applies to households in council tax bands A, B, C or D. In England, this is expected to cover roughly 20 million households, with payments delivered through the council tax system, the BBC reported. Scotland, Wales and Northern Ireland are also in line for funding via devolved government allocations, with Healey urging them to “do the same”.
Homes in council tax bands E to H will not receive the automatic £100. However, councils will have access to an extra £100 million pot to support low-income or vulnerable households that miss out.
