Data from HMRC shows that insurance premium tax receipts totalled £6.8bn for the first nine months of the 2025/26 tax year. This is £115m up on receipts for the same period in the previous tax year, which went on to achieve a record total for IPT receipt of £8.88bn.

Figures from the Office for Budget Responsibility forecast that IPT receipts for this tax year will hit £8.97bn. It believes they will continue to rise and surpass £10bn in the 2030/31 tax year.

Cara Spinks, spokesperson at financial services 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.”

IPT was first introduced in the mid-1990s at a single rate of 2.5%. Today there are two rates. The standard rate is 12%, while the higher rate is 20%. The higher rate applies to travel insurance, mechanical or electrical appliances insurance and some vehicle insurance.