20 March 2026
If you are covering the latest HMRC tax receipt data, please see a corrected version of the previous comment issued earlier this morning from Shaun Moore, tax and financial planning expert at Quilter:
“HMRC’s February figures show again how frozen thresholds are driving the tax take. What was once labelled a stealth tax has been deployed for so long, and so consistently, that it is no longer remotely subtle. Gross HMRC Tax & NICs receipts for April 2025 to February 2026 are £860.7 billion, which is £72.6 billion higher than the same period last year. Importantly, these figures still pre‑date any fallout from the Iran conflict. The impact of higher borrowing costs and renewed volatility in energy markets will appear in future releases, not today’s data.
“IHT receipts for the 2025/26 tax year have already reached £7.7bn, surpassing the 2023/24 total of just under £7.5bn with a month still to go. The 2024/25 total was £8.25bn. The surge reflects rising house prices and broader asset inflation, which are pushing more estates above the frozen £325,000 threshold. April’s reforms to agricultural and business property reliefs will also begin to shift the system. The government initially intended to cap 100% relief at £1 million per individual, but after sustained pressure from farmers it lifted the threshold to £2.5 million each, or £5 million for couples, with only the excess qualifying for 50% relief. Even with that concession, the direction is tightening. And from April 2027, most unused pension wealth will fall within IHT, meaning liabilities will rise sharply for many families. IHT is certainly no longer a tax aimed only at the mega wealthy.
“PAYE Income Tax and NIC receipts between April and February rose to £428.8bn, which is £43.9bn higher than the same period last year. With income tax thresholds frozen until 2031, more income is being captured by the system and earners are being lifted into higher bands earlier in their careers. Fiscal drag is steadily raising the effective tax burden while households contend with higher mortgage costs and persistent inflation, which is likely to rise again due to the conflict in the Middle East.
“Very high Capital Gains Tax receipts also reflect the much tighter regime now in force. February’s CGT receipts came in at £2.7bn in the month compared with £1.4bn in the same month a year earlier, which is a significant increase. While CGT commonly rises as the tax year end approaches, today’s numbers show just how much the reduced annual allowance and higher rates are drawing more everyday disposals into the tax net and pushing up government tax take.
“With the tax year end approaching, households should make full use of the allowances still available. ISA contributions, pension top‑ups under current rules and annual gifting allowances all help manage exposure. With April’s reforms approaching and the 2027 pension‑IHT change firmly on the horizon, early planning and clear advice are increasingly essential.”
