The latest figures from HMRC reveal a record-breaking tax haul of £82.5 billion in July 2024, the highest ever for that month.

However, experts at Blick Rothenberg warn that anticipated tax hikes in the upcoming October Budget could swiftly erode these gains.

Joe Neal, Manager at the leading audit, tax, and business advisory firm, highlighted that income tax receipts reached an unprecedented £32.7 billion, with self-assessment income tax alone contributing £12.9 billion, up from £11.8 billion the previous year. This increase suggests improved profitability among small businesses, as fewer self-employed individuals have reduced their payments on account compared to last year.

PAYE receipts for the first quarter of 2024/25 also saw a 5% rise, reflecting recent above-inflation pay increases in the public sector. Meanwhile, corporation tax receipts surged by 8.6% compared to the previous year, driven by the rise in corporate tax rates from 19% to 25% in April 2023. This suggests that businesses are beginning to recover from the high-inflation environment.

Inheritance tax collections were the second-highest on record, bringing in £749 million in July 2024, following a peak of £795 million in June 2023.

Despite these encouraging figures, Neal cautioned that the government’s need for increased spending, described as “much worse than expected,” could lead to further tax rises in the October Budget. This may push taxpayers, particularly wealthy individuals and large corporations, to reconsider their position in the UK, potentially undermining the robust tax revenues currently being reported.