Households are set to see a major increase to their bills (Image: Getty Images)

Millions of households are bracing for a 5% increase in their council tax bill next year, but there are ways to reduce the impact. The Office for Budget Responsibility (OBR) disclosed in documents released post-Budget that it anticipates council tax bills in England will rise by this amount next year.

This is the maximum increase English councils can impose without triggering a referendum. This includes a 3% general increase, plus an additional 2% earmarked for social care.

The average annual council tax bill for a Band D property is £2,280, so this would escalate to £2,394 next year. This follows Rachel Reeves' announcement of a new "mansion tax" on the most expensive homes.

Properties valued over £2mill

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