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News of rising energy prices will come as another financial knock to many people across the UK after what has been a turbulent two years. The cost of living is set to increase once again following a worldwide squeeze on gas and energy supplies.

In October, around 15 million homes saw their bills up 12%. Unfortunately, the situation is only likely to worsen, with industry leaders calling for government intervention to help tackle the “national crisis”.

At The Salary Calculator, we’ll walk you through:

• How much you can expect costs to rise by
• The causes of the price hike
• Whether there’s anything you can do to navigate this

How much will costs rise?

In the UK, the trade body Energy UK has released some bleak forecasts regarding energy bills, outlining that they could rise by 50% by springtime, which will ultimately hit low-income households and small businesses the hardest.

As a result, reports say that the energy bill for the average household could increase by £600 by April – and looking forward, next year, bills could reach £2,200-a-year on average.

Of course, with other rising living costs, this is concerning news for many. Alex Belsham-Harris, of Citizens Advice, says that already people are feeling the pinch. He added: “With major hikes to energy bills from April and other costs of living rising, the quickest and easiest way for the government to provide direct support for those hardest hit will be through the benefits system.”

What’s causing the hike?

Energy costs are on the rise for a number of reasons. Wholesale energy prices have surged as economies emerge from the pandemic, with demand increasing and fewer exports. Last year’s cold winter in Europe also played a part. So, there has been a range of technical and geopolitical issues at play. Since 2020, energy prices have risen by 250%, and in August, they rose further by a staggering 70%. This has led to more than 20 domestic suppliers going bust as the price cap prevented companies from charging consumers more to deal with this.

Although Ofgem’s price cap has limited energy suppliers in regards to how much they charge, this is to move in April and could reach £1,995-a-year per household.

What can you do?

It can be stressful thinking about the prospect of rising energy prices, and it’s understandable to have concerns and questions.

Some important information to remember is that if you’re struggling to keep up with payments, don’t put your head in the sand. Reach out to your supplier as soon as possible. Suppliers can help set up an affordable payment plan if you feel things are spiralling – they may even pass on the details of charities that can help you with your financial burden.

That said, if you feel as though the situation has advanced beyond that, it may be time to reach out to a debt adviser to help you navigate missed payments and the like.

Likewise, it’s worth noting that if your provider is one of the unlucky ones caught up in the crisis and goes bust, and you have credit on your account, it won’t be lost. Instead, your balance will be transferred to your new energy supplier – the same goes for any debt on your account; it will be passed on.

Of course, there are ways you can use energy more efficiently, too, to keep your bills lower. Simple things like not leaving appliances on standby and switching off lights when they’re not needed can have a big impact. Switching to low energy light bulbs can keep costs lower, too, as can using draft excluders and investing in better insulation and double glazing – although the latter may not be financially viable options for everyone.

2022 is finally here, and after what has been a difficult financial time for many, you may be looking for ways that you can improve your finances, especially following the splurge of the festive season.

Thousands of people make New Year’s resolutions each year, with finances often being a key focus. However, at the same time, many who make financial New Year’s resolutions find them hard to stick to. Often this is because the resolutions people make are inflexible, extreme and ill-thought-out.

At The Salary Calculator, we’ll walk you through some top tips that can send you on your way to a more secure and safe financial future and outline some resolutions that are easier to stick to. In this article, we’ll explore:

• Ways to build your credit
• How to build up an emergency fund
• How remortgaging can be helpful
• How to tackle debt
• How to become more financially literate
• How to set your sights on a new job

How to build your credit

When it comes to building credit, it may not be something you thought about until you decide you want to finance a car or perhaps buy a house. The credit system essentially gives lenders information about you and your finances, and if your credit score isn’t great, this could affect your ability to, for example, buy your dream house, or may mean you’re faced with pretty rubbish interest rates.

You can start building your credit in simple ways, such as getting a credit card. After making this decision, ensuring you pay it off in full each month will help to boost your credit score. Likewise, it’s also important to use only a small percentage of your credit limit, say up to 25%, to keep your score high. The same goes for if you have an overdraft; staying far below the limit and paying it off shows your responsibility when it comes to finances.

Keeping an eye on your household bills and setting up a direct debit is also a good way to make sure your credit score doesn’t dip into the red.

Building up an emergency fund

The last two years have certainly taken a toll on many people’s finances, and in the New Year, many may be looking to prepare and safeguard against future turmoil. Each month, if you can afford it, it can be a good idea to put away a percentage of your income for a rainy day.

According to WalletHub, working towards building up an emergency fund “should be one of the first orders of business for any financial makeover.”

The best way to start is by setting out clear goals and working out what you can realistically save. This amount will vary depending on your financial situation and type of occupation.

That said, once you’ve settled on a figure you feel comfortable with, it’s important to put this money aside in an account that enables instant access, so when you need your emergency fund the most, you’re not faced with lots of red tape and barriers. When choosing your account, it’s best to take a look at what’s out there on the market, and compare and contrast. There are a number of comparison websites that can help you out here, including Compare the Market, Money Supermarket, and GoCompare.

Remortgaging in the New Year

Remortgaging in the New Year can be a great way to save money. If, for example, your deal is coming to its end, your home’s value has increased, or you want a better rate, this could be a good move for you.

According to Norton Finance, the average household can save £400 each year through remortgaging. That said, it’s important to take into consideration whether remortgaging is the right decision for you. If, for example, your financial situation has recently changed, or perhaps you’ve experienced credit issues, or if you’re already on a good rate, this may not be the move for you.

Tackling your debt

Confronting one’s debt can feel daunting, and often it can feel easier to bury your head in the sand. However, the New Year is a great opportunity to set out a plan to face your debt head-on.

Starting to pay off your credit card debt is a great step towards better financial health, and of course, becoming debt-free can be incredibly liberating. This can be done in small chunks to make it manageable.

Elsewhere, when paying off your debt, make sure to prioritise what needs to be paid off first. Consolidating your debt can be helpful here, too, if you have different loans and credit card balances. If you’re unsure about how to go about this, speaking to financial experts can be a great way of accessing guidance.

Become more financially literate

Becoming more financially literate can make a world of difference to your life. Research shows that, in fact, few people are financially literate (just one in three in the UK).

Better financial literacy can help you to set better financial goals, invest your money more wisely, and save more efficiently. Whether it’s checking out the latest finance podcast, hitting the books or using financial management tools, accessing this kind of knowledge can place more control in your hands, help you avoid debt, and keep an eye out for risky investments and fraud.

There are some great podcasts out there that can help you on your way to becoming more financially savvy, including BiggerPockets Money, Future Rich, and Money 101, which provide down-to-earth, accessible guidance and top tips, making finances less intimidating.

Meanwhile, if you’re looking to get your nose stuck into some books, Money: A Users Guide – Laura Whateley, Real Life Money: An Honest Guide to Taking Control of Your Finances by Clare Seal, and Manage Your Money Like a F*cking Grown-Up’ y Sam Beckbessinger, may help to give you a fresh perspective on finances.

Seeking out a better paying job

The New Year is the perfect opportunity to seek out a fresh start job-wise. You may be aware that you’ve got as far as you can in your current role, and perhaps you’re not receiving the kind of wage packet that your skills entitle to you. Say goodbye to rubbish pay in the New Year, and take on the adventure of a new job. Reports even show that January is the best time of year to lookout for a new job!

That said, when looking for a new job, it’s also important to take into consideration a few different factors. Look inwards, and ask yourself why you’re seeking a new role, what kind of skills you have to bring to a new role, and what jobs do you expect to be eligible for. It’s always great to be ambitious and strive for something new and exciting, but be sure that you’re realistic in your approach, too.

Take a look at your CV and resume, ensure they’re up-to-date and in tip-top condition. This will allow you to put your best foot forward. Branch out on Linkedin, too. Connections are never a bad thing, and networking can even help you access a contact that could lead to you landing your dream job. Of course, practice interview tips as well, especially if it’s been a while since you last did an interview! This way you’ll be able to speak confidently about your abilities, experience and accomplishments and win over your interviewer.

The Self Assessment deadline is just around the corner, and by 31st January self-employed individuals must file and submit their Self Assessment tax return and pay any tax owed to HMRC.

While there’s still time to submit, it’s always best to complete your tax return as soon as possible, so you don’t risk making any silly mistakes and avoid getting hit with late penalties. Also, this year, there are some changes to Self Assessment to look out for.

At The Salary Calculator, we’ll walk you through:

• How to report Capital Gains Tax
• How to report Covid support measures
• How to access Self-serve Time to Pay
• What to watch out for

Capital Gains Tax reporting

Capital Gains Tax applies to those who have sold or ‘disposed of’ an asset, for example, a house that’s increased in value. From 6 April 2020 to 26 October 2021, this had to be reported and paid for within 30 days of completion. However, there is an update here, and for property disposals made on or after 27 October 2021, the “report and pay” deadline has been extended to 60 days.

If you’re registered for Self Assessment, it’s important to remember that you must report this on your tax return in the capital gains pages. That said, there are exemptions. If your only disposal is of your home and private residence relief applies, you don’t have to report this on the capital gains pages.

Reporting any Covid support measures

HMRC recently issued a warning to self-employed individuals that they must declare any COVID-19 grants they received on their tax return for the year 2020-2021. According to HMRC, over 2.7 million people claimed at least one Self-Employment Income Support Scheme (SEISS) payment up to 5 April 2021, and if you did indeed receive SEISS, this must be recorded.

Likewise, other Covid support measures that must be included in one’s Self Assessment are:

• The Coronavirus Job Retention Scheme (otherwise known as the furlough scheme)
• Self-isolation payments
• Local authority grants
• Eat Out to Help Out scheme

That said, it’s also important to note that if you received a £500 one-off payment as a working household receiving Tax Credits, this does not need to be reported in your Self Assessment.

Self-serve Time to Pay

For many, the last couple of years has been a struggle financially. In 2020, according to a study by LSE, over a third (34%) of self-employed workers struggled to pay for basic expenses such as rent and mortgage payments. So, if you’re feeling the pinch this year, you’re not alone. That said, for those feeling anxious and overwhelmed at their tax bill this year, there is help out there if you’re worried you can’t pay your tax bill in full. You can now spread your tax bill over a period of time online via HMRC’s self serve Time to Pay system.

The Time to Pay system is available to eligible to Self Assessment taxpayers who:

• Don’t have other outstanding tax returns or any other tax debts
• Have debts between £32 and £30,000
• The plan made must be set up no later than 60 days after the tax payment’s due date (30 March 2021)

When setting up your payment plan online, you’ll need to be equipped with:

• Your unique Tax Reference number
• Your VAT registration number, if applicable
• Your Bank account details
• Details relating to any previous payments you’ve missed

When arranging your payment plan, HMRC will ask you some questions about your financial circumstances to gauge what will be affordable for you. Questions may include how much you’re earning, what an affordable payment scheme would look like for you, what your outgoings are, whether you have any savings or investments.

What to watch out for

HMRC has issued a warning around ​​copycat websites and phishing scams ahead of the Self Assessment deadline. As the deadline approaches, scammers are more likely to target taxpayers who are in a rush to submit their tax returns and have their guard down. According to HMRC, 800,000 tax-related scams have been reported in the last 12 months alone.

Myrtle Lloyd, HMRC’s Director General for Customer Services, has subsequently published advice on what to look out for if you think you might be being approached by a potential fraudster. Lloyd says to be wary of anyone who contacts you claiming to be from HMRC and rushes you. Likewise, anyone “threatening arrest” will not be calling from HMRC. Lloyd outlined: “If you are in any doubt whether the email, phone call or text is genuine, you can check the ‘HMRC scams’ advice on GOV.UK and find out how to report them to us.”

While many are all too familiar with the gender pay gap, the gender pension gap gets a lot less coverage but is, unfortunately, a reality for many women. Now, warnings are being issued around the gap, with many calling on the government to do more as women live longer with smaller pensions.

At The Salary Calculator, we’ll walk you through and explain:

• What the gender pension gap is
• How the gap has widened
• How to navigate the gender pension gap

What is the gender pension gap?

The gender pension gap refers to the percentage difference in pension income between female and male pensioners. According to research from Legal & General, the gap is 17% at the beginning of a woman’s career, reaching 56% at retirement when compared to men.

Moreover, the average pension pot of a woman is less than half that of a man’s, and the gap even penetrates female-dominated industries.

Research from Prospect outlines that some of the reasons behind the gender pension gap include:

• An imbalance in the level of occupational and private pension saving between men and women
• The gender pay gap
• Indirect gender discrimination
• Women taking breaks or reducing hours to look after family

This imbalance, of women having to work 14.5 more years to access the same pension savings as men, occurs despite women contributing more of their income to pension savings.

Research from SunLife’s survey also found 30% of women hope to depend on their partner’s pension when they get older. However, this doesn’t take into account potential separation, divorce or early widowhood. On top of that, when it comes to divorce, research shows that three in five divorcees fail to bring up pensions when discussing their financial settlement.

Commenting on the inequality relating to pensions, Juan Yermo, Chief of Staff to the OECD Secretary-General, said: “Still today, the design of retirement savings arrangements sometimes disadvantages women compared to men, for example when eligibility criteria based on working hours or earnings restrict plan access, when contributions stop during periods of maternity leave, or when women do not get their share of retirement benefit entitlements upon divorce.”

How has the pension gender gap widened?

The pandemic has, unfortunately, worsened an already dire situation. Research from More2Life and the Centre for Economics and Business Research outlined that during the pandemic, the gap widened to £184,000 in 2021. That was £26,000 more than the previous year.

The study also found that 30% of women had found their financial situation worsened, impacting their ability to save; comparatively, 24% of men agreed.

More2Life said that the research revealed 62% of women worried about being able to “pay enough into their pension” compared to 57% of men.

How to plug the pension gap

Many pension experts and organisations are calling for government intervention to plug the pension gap.

Some of the recommendations made by Prospect include:

• Introducing a statutory requirement for the government to report to Parliament on the gap and outline plans for closing it
• Commencing an inquiry by the Work and Pensions Committee into the gender pension gap
• Implementing changes to the tax system to address and resolve the ‘net pay anomaly’, which means low earners “do not benefit from tax relief on their contributions.”

While these recommendations, if implemented, could be fruitful, change isn’t going to happen any time soon, and in the meantime, there are ways that you can safeguard your future.

Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown, outlined there are steps that women can take: “It’s not too late to make a difference to your pension value by continuing to contribute after the age of 55. You should also check with your employer to see if they will match any further contributions as this can give your retirement planning a real boost.”

It’s a good idea to check in on your National Insurance contributions and review whether there are any gaps to ensure you’re eligible for the full state pension. Also, plan ahead of time, and if possible, pay into your pension if you take maternity leave.

If you’re planning on taking a career break for another reason, it’s wise to top up your pension, too, as a way of compensating for any losses.

Ultimately, saving as soon as possible is a wise plan because even if you contribute a small amount to your pension each year, you can make full use of compound interest.

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Self Assessment: It’s coming around to that time of year again. While some may have already completed and sent off their annual tax return, there are also many who have not! In 2020, 700,000 taxpayers waited until the last day to file their return, and a staggering 26,562 taxpayers left it to the last hour.

So, if you haven’t filed your tax return yet, and perhaps are doing so for the first time, you may have a few questions, including; what on earth is a UTR number?

Don’t worry; there’s still plenty of time to file your tax return before 31st January and make sure you’re not faced with late payment fines. At The Salary Calculator, in this article, we’ll get you to speed and explain:

• What a UTR number is
• When you need a UTR number
• How to register for a UTR number if you don’t have one
• What will happen after registering for a UTR number
• Where you can find your UTR number

What is a UTR number?

UTR stands for Unique Taxpayer Reference, and this is a 10-digit number that is unique for each person or business. Just as with a National Insurance (NI) number, once you have one, you have it for life. So, even if you’ve been out of business for a while, you’ll never lose your UTR number, your number will just become dormant.

A UTR number is issued by HMRC and sometimes includes the letter K at the end of it.

When do you need to provide a UTR number?

A UTR number is required if you:

• Need to create an online account with HMRC
• Are self-employed or have a limited company
• Owe tax on savings, capital gains, and dividends
• Must register individual taxes
• Work within the Construction Industry Scheme (CIS)

How do you register for a UTR number?

If you don’t already have a UTR number and need one, the most simple and fastest way to get one is to apply online on HMRC’s website.

Of course, not everyone’s preferred method involves a computer or laptop, so rest assured, you can also apply to get your UTR number via letter too. That said, this way is, unfortunately, much slower and will involve postage fees as well.

When it comes to registering for a UTR number, this must be done within the first three months of opening your business, regardless of your occupation.

In order to register, you must also submit a few different pieces of information. This information includes:

• Your name, DOB and address
• Your contact information (preferred number and email address)
• Your NI number
• When you commenced self-employment
• The type of business you have
• Basic business information (address, number, name)

What happens after registering for a UTR number?

Once you’ve applied for your UTR number, there are a few things to bear in mind. First of all, it can take up to ten days for your UTR number to arrive, sometimes longer.

In addition to this, once you’ve heard back from HMRC and received your activation code, don’t wait around too long before using it, as it expires at 28 days.

Where can you find your UTR number?

Your UTR number can be found in a number of places, including:

• Statements of accounts
• Your Self Assessment Tax Return
• HMRC payment reminders
• HMRC Self Assessment notices

If you think you’ve either misplaced or lost your UTR number, don’t panic. Contacting HMRC is your best bet. When reaching out to HMRC, you should have your NI number to hand, as you will be asked for it when you call.

HMRC can be contacted via:

• 0300 200 3310 (UK)
• +44 161 931 9070 (Outside UK)
• 0300 200 3319 (Textphone)

Final thoughts

Navigating the world of tax returns can be anxiety-inducing for some; that said, there are several sites out there that can lend a helping hand. HMRC are always available if you need guidance on your tax return and can answer any burning questions.

Go Simple Tax also helps to make things simple and straightforward. The software provides guidance, as well as hints and tips on how to save money.