Although it is the smallest increase in six years, a travel watchdog has warned many passengers will be "amazed there are any fare rises at all" given the poor punctuality on some services.
Calculations by the Labour Party suggest commuters are now paying 25% more for season tickets than they did when David Cameron took office in 2010 - prompting Jeremy Corbyn to renew his calls for the railway network to be brought back into public hands.
Network Rail figures suggest 10.7% of trains arrived at their destination at least five minutes late in 2015 - and in June, a critical report concluded reliability on busy routes was "below requirements".
The Campaign for Better Transport has warned the price hike will anger many Britons, adding: "For some people, that is still a big increase when their wages are effectively frozen."
Although changes in the cost of annual passes are regulated, by being linked to July's rate of Retail Price Index inflation, about 50% of train tickets sold in the UK are unregulated.
Some fares, such as off-peak leisure tickets, can subsequently be increased by whatever amount is decided by train operators.
Bruce Williamson, from the Railfuture campaign group, has claimed fares are "increasingly divorced from reality" - and is calling for the Government to ditch its policy of using RPI.
"High street prices have remained stagnant for more than a year, with the official CPI inflation figure hovering around zero, yet the Government thinks it's fair to make rail travel even more expensive," he added.
From today, an annual rail pass from Basingstoke to London will cost £4,196 - £40 more than 2015.
Passengers who travel every day between Liverpool and Manchester will see their season tickets increase by £28 to £2,988.
Commuters on one of the longest routes, between Cheltenham Spa and London Paddington, are now dangerously close to paying a five-figure sum for their yearly pass - with the price of 12 months' travel increasing by 0.99% to £9,800.
And it's also bad news for workers making a daily return trip between Birmingham and London Euston on Virgin Trains, as they'll be welcoming in the New Year with a £10,012 bill.
Travellers on other routes can find out how the cost of their journeys are affected on the National Rail Enquiries website.
The rail industry has told Sky News that the 2016 price rises are justified.
Edward Welsh, from the Rail Delivery Group, said: "We understand that nobody likes to pay more to travel, particularly to go to work, but this is the lowest increase in six years.
"You only have to see where the money is going from fares - to the new stations, the extra lines and the new carriages."
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