Budget 2026: a one-off energy payment for homes in council tax bands A to D

What has happened

In the Autumn Budget on 28 October 2026, the government announced a Household Energy Payment of £100 to help with energy costs. The Department for Energy Security and Net Zero says up to 20 million households in England will be eligible, and payments will be made from January 2027.

You qualify if you live in a home in council tax bands A to D as your main home and you are liable for council tax on it. The government says this will include most households that are exempt from council tax, and that the full eligibility rules will be published later. Second homes, empty properties and households where the householder is not responsible for paying council tax do not qualify.

The government also said the temporary VAT cut on household electricity bills will be extended until July 2027, and that it has asked Ofgem to remove standing charges from household gas bills as early as 2027. For people already behind on energy bills, it plans a Debt Relief Scheme. Ofgem will consult on the final design of that scheme first, so it is a proposal, not something you can apply for yet.

What it means for you

If you pay council tax by direct debit and your home is in bands A to D, the payment should go straight into your bank account. If you pay another way, your council will invite you to apply. Scotland, Wales and Northern Ireland are getting funding instead, and their own governments will decide what support to offer.

If your home is in a higher band but you are struggling, the government is giving councils an extra £100 million for discretionary support. Each council will set its own rules and publish how to apply once its scheme is ready.

The proposed Debt Relief Scheme is aimed at energy billpayers on means-tested benefits or disability benefits, and pensioners, who have built up energy debt since the 2022 to 2024 energy crisis. The government says debt could be written off if you re-engage with paying it, but the details are still to be decided.

Who it affects

Households in England living in council tax bands A to D, plus people across the UK who are struggling with energy bills or energy debt.

What you can do

• If energy bills or other debts are already a struggle, get free debt advice now from MoneyHelper, StepChange, National Debtline or Citizens Advice. You do not need to wait for the payment.
• Check which band your home is in with the Check your Council Tax band service on GOV.UK.
• Be careful with messages about this payment. The government says nobody other than your council should contact you asking you to claim it. If you are unsure whether a message is genuine, check directly with your council, which you can find through Find your local council.
• If you get means-tested benefits, check whether you can also get the Warm Home Discount.
• If you are behind on energy bills, talk to your supplier rather than ignoring it. The government says the proposed Debt Relief Scheme will depend on people re-engaging with their supplier and with paying their debt.

Sources

Every fact in this page was checked against these official sources on 29 October 2026.

1. What the Autumn Budget 2026 means for your energy bills Department for Energy Security and Net Zero (GOV.UK)
2. Budget 2026: Breathing space for today, hope for the future HM Treasury (GOV.UK)
3. Warm Home Discount Scheme GOV.UK

Written and fact-checked by the PiggyBank editorial team. Published 29 October 2026. This news is general information, not financial advice. How we write and check our guides.