Britons hit by £1,254 rise in bills this year as council tax, energy and water bills push up cost of living
British households have endured a punishing 2025, with essential bills rising by an average of £1,254 over the course of the year.
Costs increased in across almost every area of household spending, new analysis by Uswitch has found.
Here are the areas that have pushed up household bills over the past year.
The spring months proved particularly challenging in 2025, with the period becoming known as “Awful April” due to multiple price rises taking effect at the same time.
Energy bills rose alongside council tax, water charges and telecommunications costs, leaving millions of households facing significantly higher outgoings.
Council tax bills increased by an average of five per cent across most English local authorities, which is the maximum rise permitted without triggering a local referendum.
Several councils were granted special permission to raise council tax beyond the usual limit, including Birmingham, Bradford, Newham, Somerset, Trafford and Windsor & Maidenhead.
These increases formed a substantial part of the overall pressure on household finances, representing a fixed cost that cannot be reduced or avoided.
Water bills rose by an average of £123 in 2025, the largest increase since the sector was privatised in 1989.
British households hit by £1,254 bill in 2025
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GETTY
Telecommunications costs also increased, with broadband and mobile phone providers introducing price rises throughout the year.
In addition to this, the television licence fee went up, increased by £5.
Car tax also rose by £5 for drivers paying the standard rate, as drivers of electric vehicles faced higher costs after the exemption from car tax was removed.
Energy prices remained a significant concern for households throughout the year, with Ofgem’s energy price cap increasing by £17 over the course of the year.
From January 1, the cap will rise again by another £3.
To compound this, following Rachel Reeves’s Autumn Budget, working Britons could pay £4,000 more a year to the tax man with the freezing on income tax thresholds until 2030-31.
Furthermore, a tax on savers is set to be introduced, among other groups who were targeted, with the tax-free cash isa allowance dropping to £12,000 from £20,000.
Two million homes say they will not turn on their heating this winter
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GETTYUswitch spokesman Sabrina Hoque said: “Pressure points have been widespread.
“Energy debt hit an eight-year high in October, with households now owing £780million to their suppliers.
“The strain is so severe that more than two million homes say they will not turn on their heating this winter, a fifth higher than last year.”
Ms Hoque also highlighted rising telecommunications costs as a key area of concern.
She said: “With average annual jumps of £21.99 for broadband and £15.90 for mobile in the last few months, nearly every major provider has announced updated price rise rates for new customers, with monthly increases of up to £4.”
Customers whose contracts end before April could save money by switching providers – up to £203 a year.
Citizens Advice chief executive Dame Clare Moriarty also warned that financial pressures remain severe.
“The cost-of-living crisis is not over.”
She added: “Stubbornly high bills and increasing living costs mean four million people are in a negative budget, meaning they cannot afford essentials like energy bills, rent or food.”
The lack of heating in homes can contribute to illnesses
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PEXELSDame Clare said Citizens Advice advisers see the impact of rising bills daily.
“People come to us feeling like they are constantly fighting to stay afloat but, despite their best efforts, are sinking further into the red.”
She called on the Government to increase Local Housing Allowance for people struggling to pay rent.
Citizens Advice is also urging ministers to strengthen support for utility bills, saying rising energy and water costs continue to place household finances under unsustainable pressure.
