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The UK’s public finances swung to a surplus in January, propelled by record income and capital gains tax receipts, offering a rare boost to chancellor Rachel Reeves as she seeks to keep her Budget plans on track and kick-start the economy.
The public sector was in surplus by £15.4bn in January, £0.8bn more than last year and the highest seen in that month since 1993, the Office for National Statistics said on Friday. Analysts had expected government spending to exceed receipts by more than £20bn.
However, borrowing for the financial year to January was still higher than a year earlier, totalling £118.2bn — £11.8bn more than at the same point in the 2023-24 financial year, the ONS said.
A surplus often occurs at the start of the calendar year because self-assessed income and capital gains tax falls due at the end of January.
The ONS said receipts from these taxes of £36.2bn in January 2025, £3.8bn more than a year earlier and the highest for January since monthly records began in 1999.
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