How to understand a price increase

Separate the price from the bill

A bill can rise even when the unit price is unchanged. Take a service costing £2 per unit: 20 units cost £40. If the next bill has 25 units at £2.20 each, it costs £55. The total bill rose 37.5%, but the unit rate rose 10%.

To explain the £15 difference, hold usage at 20 units first: the higher rate adds £4. The extra 5 units at £2.20 add another £11. This is a useful way to check what changed before contacting a supplier. It is arithmetic, not an assessment of whether a charge is allowed.

Use the Price Increase Calculator to compare rates and totals separately. Its worked examples explain the percentage formula and how to reverse a rise.

An annual saving may hide a first-year cost

Suppose an old service is £40 a month and a replacement is £35 a month with a £50 setup fee. The recurring saving is £5 a month, or £60 over twelve payments. After the setup fee, the first-year saving is only £10, assuming there are no overlapping payments or other charges.

The calculator's yearly result compares recurring prices only. Record setup costs, exit charges, credits and the start date separately. An introductory rate lasting three months should not be multiplied by twelve as if it lasts all year.

Two increases compound

A £100 price rising by 10% becomes £110. A second 10% increase applies to £110, giving £121. The combined increase is 21%, not 20%. A later 10% decrease gives £108.90, not the original £100.

For a record of successive changes, keep one line per effective date with the price before, percentage change and price after. The apply mode can calculate each step; the compare mode can check the overall start-to-finish change.

Questions to take back to the supplier

• Are both amounts for the same billing period and quantity?
• Did a discount end, or did the base rate change?
• Is there a one-off charge or a part-period adjustment?
• Which date does the new rate start, and how many payments remain?
• Does the notice match the tariff, invoice or agreement?

Keep the notice and the two itemised bills together. Describe the difference you found without assuming the percentage alone proves an error. Contract rights and complaint routes depend on the service and agreement.

Examples reviewed 1 September 2026. These are hypothetical amounts, not current supplier prices.

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