UK Tax Revenue Statistics 2026

HMRC collected approximately £1.1 trillion in tax in 2024/25, equivalent to around 35% of GDP. The UK tax burden is at its highest level since the 1940s as a share of GDP, reflecting rising income tax thresholds being frozen while wages grow.

Income tax is the largest single revenue source at £268 billion. The personal allowance is £12,570 and the higher rate threshold is £50,270. Freezing these thresholds since 2021 while wages have risen has brought millions of additional people into higher tax bands — a phenomenon known as fiscal drag.

VAT at the standard rate of 20% raises approximately £176 billion. Corporation tax was raised from 19% to 25% in April 2023, boosting receipts to approximately £85 billion.

How much tax does the UK collect per year?

HMRC collected approximately £1.1 trillion in tax in 2024/25 — around 35% of GDP. This is the highest tax burden as a share of the economy since the 1940s.

How much income tax does the UK collect?

Income tax raises approximately £268 billion in 2024/25 from around 35 million taxpayers. The basic rate is 20%, higher rate 40%, additional rate 45%.

What is the UK VAT rate?

The standard UK VAT rate is 20%, raising approximately £176 billion per year.

Why is the UK tax burden at a record high?

Income tax and NI thresholds have been frozen since 2021 while wages rose with inflation (fiscal drag). Corporation tax was also raised from 19% to 25% in 2023.

How does UK taxation compare to other countries?

At around 35% of GDP, the UK's tax burden is below the EU average of approximately 40% and significantly below Scandinavian countries, but higher than the USA (27%) and Australia (29%).