Data from HMRC has shown that receipts for insurance premium tax were £1.48bn in May. This was an increase of £50bn in the same month last year. In the first two months of the 2025/26 financial year, the tax has raised £2.13bn, up on the £2.05bn recorded in the same period last year.

Cara Spinks, director at financial services consultancy Broadstone, said: “IPT receipts in May reached a record £1.48bn, maintaining the elevated levels seen in April and suggests another strong year of revenue for the Treasury might be on the cards.

She added: “This trend is contributing significantly to the growth in insurance premiums, alongside an increase in both the frequency and cost of claims.”