Treasury on target for record £9bn insurance tax earnings after December receipts revealed

Insurance Premium Tax (IPT) receipts for December 2025 totalled £43m, bringing the year-to-date total for the levy to £6.8bn in the first nine months of the financial year.

These figures reveal that IPT revenue is up £115m on the same nine-month period in 2024, when total income amounted to just shy of £6.7bn.

That tax year – ending in April of 2025 – saw the Treasury earn a record £8.88bn from insurance tax, a figure which is set to be surpassed if current projections are met.

Indeed, current office for budget responsibility (OBR) projections suggest £8.97bn will be netted by the end of the current fiscal year, a figure that could rise to £10.1bn by the 2030/31 financial year.

The record figures have previously led to calls from many in the industry to lower the rate of IPT, though the announcement in chancellor Rachel Reeves’ November 2025 budget that IPT rates would not be raised was met with appreciation.

No signs of easing

Commenting on the figures, Cara Spinks, head of life and health at financial consultancy Broadstone, said: “With three months remaining in the financial year, December’s IPT intake reinforces that this tax shows no signs of easing as the year‑to‑date total climbs to £6.8bn.

“Workplace health insurance claims continue to rise. The UK’s persistent ill‑health burden is acting as a drag on economic growth and employers are increasingly being left to shoulder the consequences.

“With IPT continuing to generate record sums and acting as a barrier to wider uptake of these essential benefits, the government needs to reassess the role of IPT on health insurance and consider an exemption to support workforce participation and NHS resilience.”