December can be a costly month with Christmas expenses, but there are significant financial developments on the horizon that could impact your finances.
Households can anticipate a Christmas bonus payment, alongside updates on inflation and interest rates. Additionally, ongoing winter assistance programs such as Cold Weather Payments and the Warm Home Discount will extend into December.
The Department for Work and Pensions (DWP) is set to distribute its annual tax-free Christmas bonus of £10 to eligible households, typically disbursed in the initial week of December. This bonus does not affect existing benefits and should be received by January 1 for qualifying recipients.
In other financial news, the Office for National Statistics (ONS) will unveil the latest inflation figures on December 17, revealing a current rate of 3.6%. The Bank of England will announce its interest rate decision on December 18, with the current base rate at 4%, having undergone five reductions since August 2024.
As the holiday season approaches, benefit payments scheduled for Christmas and New Year’s bank holidays may be issued earlier. For instance, benefits due on Christmas Day or Boxing Day will likely be paid on December 24. Similarly, benefits scheduled for January 1 may be paid on December 31.
Self-assessment taxpayers looking to have HMRC collect owed taxes through their PAYE tax code must submit online returns by December 30. This option applies to taxpayers with tax bills under £3,000 who already pay tax through PAYE.
Throughout December, support schemes like Cold Weather Payments, Winter Fuel Payments up to £300, and the Warm Home Discount offering £150 off electricity bills will continue to assist eligible households.