Insurance premium tax (IPT) receipts in the United Kingdom reached £1.03 billion in July 2025, according to the latest update from HM Revenue & Customs. This figure represents an increase of £68 million compared to July 2024, when receipts stood at £957 million.
For the first four months of the current financial year, total IPT collected amounted to £3.20 billion. This is £123 million higher than the £3.07 billion collected during the same period last year. The previous financial year saw record IPT revenues of £8.88 billion.
The Office for Budget Responsibility (OBR), in its Spring Statement, forecast that IPT would generate £9.2 billion for the Treasury in 2025/26, with projections rising to £9.9 billion by the end of the decade.
The recent figures are part of a long-term trend of rising IPT receipts in the UK. Over the past decade, IPT revenues have grown substantially, with receipts for the six-month period from April to September 2014/15 totalling £1.5 billion, compared to much higher figures seen in recent years. Five years ago, the same period saw £3.2 billion collected, highlighting the scale of increase over time.
Cara Spinks (pictured above), head of life & health at Broadstone, commented on the figures, saying, “July’s IPT receipts once again show how quickly revenues from this tax are accelerating. It has become a reliable source of income for the UK government, but one that is heavily influenced by the uptake of health insurance products, which is continuing to grow.”
Employers have also been affected by these trends, with many experiencing significant increases in healthcare costs. This has prompted a shift towards private medical insurance and health cash plans as companies seek to support employee health amid ongoing NHS waiting list pressures.
Spinks noted that ongoing pressures within the NHS are prompting some individuals to seek private health cover, while employers are expanding workplace benefits and insurance offerings.
“Continuing pressures within the NHS mean that some individuals are unable to receive care on a timely basis, increasingly turning to private cover alongside employers continuing to widen workplace benefits and access to valuable insurance products to support their teams,” she said.
However, there are concerns that further increases in IPT could prompt both employers and individuals to reconsider their use of private health cover. Rising costs, driven by both inflation and tax, may lead some to reduce or forgo private medical insurance and health cash plans, potentially increasing reliance on the NHS and impacting the broader healthcare system.
“Even as demand for health insurance grows, inflationary pressures on costs in the industry mean that premiums are increasing, and the added burden of IPT risks putting cover out of reach for many,” Spinks said.
Looking ahead to the Autumn Budget, Spinks suggested that the government could consider targeted IPT relief for health insurance.
“With the impending Autumn Budget, the Government has an opportunity to deliver a targeted IPT relief on health insurance. This would not only help maintain affordability and widen access but would also deliver clear economic benefits – supporting smaller employers, protecting workforce productivity, and easing pressure on public health services.”
Forecasts from the OBR indicate that IPT receipts are expected to continue growing in the coming years. The OBR projects total collections of £45.9 billion over the five-year period from 2024/25 to 2028/29, an increase of £3.5 billion from previous forecasts.
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