HM Revenue & Customs' ("HMRC") tax take hits £575 billion fuelled by 15.5% increase in Corporate Tax receipts.
The latest statistics released by the Government show total HMRC receipts hit £575 billion for the last 12 months to June 2017, representing a 6.86% increase over the previous year. This is partly fuelled by a 15.5% surge, equivalent to £6.9 billion, in Corporate Tax receipts.
Paul Smith, partner at Blick Rothenberg, said: “Brexit seems to be working well as far as HMRC’s receipts of corporation tax are concerned. In the 12 months to June receipts of corporation tax increased by 15.5% to £51.5bn.
“The rise was actually 20% in the 9 months to June 2017. This sharp increase follows the Brexit vote at the end of June 2016 and the fall in the value of sterling. This has been positive for UK companies exporting goods and services abroad, enabling them to sell more at higher margins, generate greater profits and pay more tax. “
He added: “The next 12 months may be a little more difficult as costs of imported raw materials have also risen but it is good to see that British business has done well so far.”
Income tax, which is the largest contributor to the total receipts figure, was up £8 billion over the same period, representing a slightly lower increase of 4.77%. Over half of the income tax receipts increase is due to tax taken through the Self-Assessment regime, which was up by £4.4 billion in the last year, a staggering 18.05% increase.
Paul Haywood-Schiefer, assistant manager at Blick Rothenberg, commented: “The increase to £575 billion total receipts in the last 12 months represents a new landmark for the total tax receipts of the Treasury, and these continue to grow at pace. Based on this current growth the £600 billion figure should be reached around January 2018.
“Another notable increase is the growth in the Self-Assessment receipts over the last 12 months, which has contributed more than half of the total increase in the income tax receipts over that period. Given that the total Self-Assessment receipts in any given 12 month period account for approximately 16% of the total income tax receipts, this is a remarkable figure.”
He added: “This would suggest those in Partnerships or who are self-employed or have a personal property portfolio (typical people who would pay income tax through Self-Assessment) had a bumper year in the 2015/16 tax year.”
Elsewhere, Stamp Duty Land Tax (SDLT) receipts are up £1.1 billion on the previous 12 months, a flat figure of 10% growth.
Paul Haywood-Schiefer said: “SDLT is steadily rising in terms of the amounts collected and has for the first time, broken an average of £1 billion a month for the last 12 months, with £12.1 billion collected during this time. This has come about due to two main factors being the November 2015 change to how SDLT is calculated and also because of the 3% surcharge on second and additional properties, which came into existence from April 2016.”
For more information, please contact Paul Smith
or Paul Haywood-Schiefer