December can be a costly month primarily due to Christmas expenses, but other significant financial events are on the horizon that could impact your finances.
Certain households are set to receive a Christmas bonus payment, and updates on inflation and interest rates are forthcoming.
Various winter assistance programs, such as Cold Weather Payments and the Warm Home Discount, will be active in December, providing support to those in need.
The Department for Work and Pensions (DWP) is preparing to distribute the annual tax-free Christmas bonus of £10 to eligible households. This payment does not affect other benefits and is typically received by eligible claimants in the first week of December, with delivery expected by January 1.
Inflation data from the Office for National Statistics (ONS) is scheduled for release on December 17, offering insights into price fluctuations. The current inflation rate stands at 3.6%, having peaked at 11.1% in October 2022.
The Bank of England will announce its next interest rate decision on December 18. The current base rate is 4%, having undergone five reductions since August 2024, when it was at 5.25%. This rate influences borrowing costs for customers by impacting what banks and lenders charge.
Due to the Christmas and New Year bank holidays, several benefit payments will be processed earlier next month. Benefits scheduled for Christmas Day or Boxing Day will likely be paid on December 24 instead. Similarly, benefits due on January 1 will be issued on December 31.
Self-assessment taxpayers seeking HMRC to collect owed taxes via their PAYE tax code must submit their online returns by December 30. Taxpayers can utilize this method if they owe less than £3,000 and already pay tax through PAYE, such as employees with additional earnings from side jobs.
Throughout December, support schemes will continue, including Cold Weather Payments of £25 during prolonged sub-zero temperatures, Winter Fuel Payments up to £300, and the Warm Home Discount offering £150 off electricity bills.