UK Posts Largest Budget Surplus on Record

2026-02-20 07:16 By Kyrie Dichosa 1 min. read

Public sector net borrowing in the UK, excluding public sector banks, recorded a £30.4 billion surplus in January 2026, more than doubling from £14.5 billion a year earlier and exceeding expectations of £23.8 billion.

This marked the largest budget surplus since records began in 1993, as total public sector receipts rose by £16.8 billion year-on-year, supported by strong capital gains tax inflows after companies and individuals brought forward asset sales ahead of planned tax increases.

January receipts are typically elevated due to self-assessed payments, with combined income and capital gains tax revenues reaching a record high.

Meanwhile, public sector expenditure increased by £0.9 billion, as higher public service and benefit costs were largely offset by lower interest payments on government debt.

For the financial year to January, borrowing totaled £112.1 billion, below the OBR’s £120.4 billion forecast, though still the fifth-highest April–January borrowing on record.



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