April tax figures show big increase in income tax and capital gains tax as HMRC pulls in more revenue from high tax burden, and huge hikes at the forecourt see more VAT going to the Treasury

Analysis of the latest HMRC figures shows tax take for the first month of the new tax year continues to soar. HMRC collected £87.3bn in taxes in the month of April, up a mighty £6.3bn from April 2025, but public spending continues to escalate and rising bond costs for the government add to deficit concerns, not to mention underlying worries about future tax grabs at the autumn Budget.

Income tax, capital gains tax (CGT) and national insurance contribution (NIC) receipts for April 2026 were £52bn, up £4.4bn on the same period last year as the pain of years long freezing of the tax free threshold really begins to generate substantial revenue for the government.

Breaking the numbers down, income tax PAYE was up from £30.7bn to £32.3bn, while employee NICs was up by £160m to £4.64bn from £4.48bn a year ago. Of course, it was employers hit the hardest on the NI front, with Class 1 NICs up nearly £3bn year on year, to £15.55bn from £12.66bn.  

HMRC said the reason for the higher figure was down to bankers’ bonuses, stressing that ‘peaks in January to April typically capture PAYE bonus-related receipts, particularly from the financial sector’.

However, frozen thresholds are clearly having a painful impact for ordinary taxpayers, particularly the hundreds of thousands being dragged into higher rate tax at 40%.

Even fuel duty revenue was up £300m in April as the government earned more revenue on the back of soaring petrol and diesel prices after the outbreak of the war. The monthly figure was £2.3bn.

Taxpayers are being hit from all sides with the cost of living crisis continuing to force up prices, which in turn hikes VAT take. Total VAT receipts for April 2026 were £20.5bn, a significant £1.5bn higher than the same period last year. Basically this figure continues to edge upwards recording the highest ever April figure, up more than £7bn on the pre-pandemic April 2019 VAT figure of £13.04bn.

On the CGT front, the overall tax take was well down after a flurry of selling in the 2025-26 tax year when concerns grew that the chancellor would hike rates in line with income tax, a rumour which never came to fruition. April saw £162m in CGT payments, against £191m a year ago, but set against a backdrop of record CGT for the for 2025-26.

Inheritance tax (IHT) was down for the month, but this fluctuations reflects events, and is often distorted by large estates falling in particular months. The April figure was £715m, comfortably below £780m in 2025, but on a par with the average monthly IHT for 2024-25 which was £705.5m so the Treasury will no doubt be hoping for this tax to keep giving.

Tom Goddard, assistant manager at Blick Rothenberg, said: ‘The decline is likely to be temporary as April 2026 marks the final year before pension wealth is brought within the scope of IHT from April 2027, a reform expected to substantially increase receipts.’

Estates can only expect more tax pain as like most other taxes hitting individuals thresholds have been frozen for year.

Susannah Streeter, chief investment strategist, Wealth Club, added: ‘Although receipts dipped slightly in April compared with the same month last year, the government’s take from bereaved families remains exceptionally high and is still on course for another record-breaking year.

‘The government has struggled with inheritance tax reforms with crackdowns on farmers and business owners proving deeply unpopular, while years of frozen allowances mean more ordinary families are quietly being pulled into the inheritance tax net through stealth taxation.’

White, S. (n.d.). Tax take up £6bn in single month of April as VAT spikes. Business & Accountancy Daily.