You probably already know the UK isn’t one of the cheapest countries in the world. But it’s easy to overlook some costs while you’re planning a big move overseas.
We’ve broken down the hidden expenses that come with living in the UK. So you can plan, save and avoid stressful surprises.
The Immigration Health Surcharge
This is one of the first surprising fees you’ll be hit with while planning your move. It costs £776 for students and children, or £1,035 for everyone else.
The surcharge is paid as part of your visa application, so you’ll need to budget for it before you even arrive. The good news is that once you’re here you’ll be able to access almost all NHS healthcare services for no extra cost.
Budgeting tip: It’s good to know you’ve pre-paid for your healthcare before you get here, but not everything is free. You’ll need to pay for eye tests, dental services and prescriptions on top. Make sure you’ve accounted for the cost if you need these.
10 weeks’ rent up-front
Renting in the UK can seem very expensive. You also need to budget for paying a lot in one go, right at the start.
First, there’s a holding deposit while your references are checked. This can be up to one week’s rent. You’ll also need to pay a security deposit which can be up to five weeks’ rent. Rent is paid up front – so that’s another month’s-worth.
Altogether, it’s best to budget for 10 weeks’ rent, just to get moved in.
Budgeting tip: The holding deposit should be knocked off your rent once you’re moved in. The security deposit is refunded at the end of the tenancy, as long as you haven’t caused any damage.
Make sure you take lots of photos and videos the day you move in so you can easily prove the state of the property. The landlord or letting agent should also complete an inventory with you and place your deposit in an official tenant deposit protection scheme.
We’ve got a great perk to help new renters too. Marshmallow customers can get up to 25% off the Housing Hand guarantor service. It’s really useful if you haven’t built up a UK credit score yet.
Actually, we can help with that too. Customers can also get a free trial and discount on Pillar, which can help you build a credit score, just by making rent payments on time.
Council tax
People living in the UK have to pay council tax to the local authority. It helps pay for services like rubbish collection, schools and roads. It’s owed by the occupier, so it’s usually the tenant who pays, not the landlord.
It’s quite a big monthly bill and it varies a lot around the country. Generally the bigger your place, the bigger the bill. You need to find out your council tax ‘band’, then check how much you’ll pay on the local authority’s website.
You should tell the council when you move in and give details of who’s living there. You might get a letter about it just after moving in, but otherwise there will be a form on your local authority’s website.
It’s best to do it as soon as you move in as any unpaid council tax will be backdated – meaning you’d have to pay a lot in one go for the missed payments.
Budgeting tip: Council tax is usually billed for the year, then paid in installments over 10 months, not 12. There are no charges in January and February.
You can ask to pay over 12 months if it makes budgeting easier. You’ll have a slightly smaller bill to pay every month instead.
You should also check for council tax discounts. For example, most local authorities have a discount of 25% for households with only one adult. Students are also exempt, so if you live in a house with only other students there’s no council tax to pay.
Standing charges for gas and electricity
Tenants are usually responsible for the gas and electricity bills. Your landlord should give you details of the supplier, so you can let them know when you’ve moved in.
It’s always good to be frugal with your utilities to save money, but unfortunately you don’t just pay for what you use. There’s also a standing charge per day, just to be connected.
The average standing charge in May 2025 is around £19 per month for electricity and £10 per month for gas. That means that if you leave your place empty for a couple of weeks to have a holiday or visit family, you’ll still have to pay the standing charge.
Budgeting tip: You don’t have to stick with your landlord’s choice of electricity and gas supplier. Once you’re moved in, you can use a site like Uswitch to compare prices and move to a cheaper provider.
Even switching to a cheaper plan with the same supplier can save money – so give them a call to check what’s available.
Standing charges for gas and electricity
Tenants are usually responsible for the gas and electricity bills. Your landlord should give you details of the supplier, so you can let them know when you’ve moved in.
It’s always good to be frugal with your utilities to save money, but unfortunately you don’t just pay for what you use. There’s also a standing charge per day, just to be connected.
The average standing charge in May 2025 is around £19 per month for electricity and £10 per month for gas. That means that if you leave your place empty for a couple of weeks to have a holiday or visit family, you’ll still have to pay the standing charge.
Budgeting tip: You don’t have to stick with your landlord’s choice of electricity and gas supplier. Once you’re moved in, you can use a site like Uswitch to compare prices and move to a cheaper provider.
Even switching to a cheaper plan with the same supplier can save money – so give them a call to check what’s available.
TV Licence
Even if you resist the temptation to sign up for paid movie services like Netflix and Disney Plus, you might still have to pay to watch TV.
You need to buy a TV Licence if you watch any ordinary channels on any device – TV, phone, or laptop. This includes watching shows and channels from abroad, not just UK ones. You’ll also need one if you ever watch ‘catch-up’ programmes on BBC iPlayer.
If you don’t get a licence when you should you can be fined up to £1,000. Ouch.
The licence costs £169.75 per year and you can choose to pay it in monthly direct debit installments. You can also pay in weekly or fortnightly installments at any shop with the ‘PayPoint’ sign, but if you do this you have to pay double for the first six months so you’re ahead with payments.
Budgeting tip: The TV licence is per household, not per person, so check whether you can split the cost if you’re in a shared house or student accommodation. The basic rule is one licence per tenancy agreement. If you each have your own agreement, you all need a licence each. If you have a joint tenancy agreement you can share a TV licence.
If you only stream catch-up services other than BBC iPlayer and never watch any standard TV channels, you don’t need a TV licence. You might get a visit from an enforcement officer and you’ll need to show that you’re not watching any standard channels, or BBC iPlayer.
Every Marshmallow insurance policy comes with a discount on the Emma budgeting app. Give it a try to check you can afford any TV subscription services and keep tabs on your spending.
Getting on the road
Whether you’re bringing your car to the UK with you or planning to buy one here, you need to budget for three things, as well as fuel. Road tax, MOT test and car insurance.
You’ll have to pay road tax if you buy your car in the UK. It’s £195 per year for most cars over a year old. You can check the rate here.
If you’re bringing your own car from abroad and staying for more than six months, you’ll need to import it. You’ll pay customs duties and VAT, then you’ll need to register it with DVLA and pay the road tax.
Cars in the UK also need an MOT test every year once they’re three years old. You take it to a garage where a mechanic runs checks and gives you a certificate to show it’s roadworthy. The cost of the MOT itself is £54.85, but you might also need to budget for some repairs to pass the test.
Finally, there’s car insurance. We’re here for you with that one. Check out our policies made for UK newcomers like you.
Budgeting tip: Most insurers treat you like a totally new driver with no experience when you arrive in the UK. We can take all your driving experience into account, even if it was overseas, and offer a discount. We can also cover you while you’ve got a non-UK driving licence.
Give us a try to see if we can get you on the road for less when you get to the UK.
You’ll also get a 10% discount at ClickMechanic when you’re insured by us. It’s a great way to get your car ready to pass its MOT.
Passing your driving test
You can only use your overseas driving licence in the UK for 12 months, so if you’ve moved here, you might need to pass the driving test. Unless you’re from one of the countries where you can exchange your licence for a UK one once you’re a resident. DVLA has a handy tool to help you check if you can do this.
If you can’t exchange your licence, the driving tests will put a dent in your budget. The theory test costs £23 and the practical test is £63-£72.
You might also need some driving lessons to brush up on UK road rules. These can cost £25-50 each.
Budgeting tip: YouTuber and UK Immigration Advisor Trainee Tochi Esther has this great tip to help get you through your test quickly and without spending so much. “learn how to drive in your home country before you move. That way, you’ll only need a few lessons to get used to the UK roads.”
You should also book your test well before the 12 months driving on your overseas licence is up. The current driving test wait times can be as long as five months in some areas. That’s a long time to be paying for notoriously expensive UK public transport.
