UK Finance publishes latest banking sector tax report

UK Finance has today published its latest total tax contribution of the UK banking sector report, produced by PwC.

The report shows that the UK banking sector generated £38.8 billion in taxes in the financial year to the end of March 2022. This means that the sector accounted for 4.7 per cent of the government’s total tax receipts during that period.

The total contribution is comprised of £18.8 billion in taxes borne - those that are a direct cost - and a further £20 billion in taxes collected, such as income tax and employee national insurance.

Total employment taxes accounted for £21.9 billion of the total taxes contributed by the sector, equivalent to 6.3 per cent of all UK employment tax receipts. This reflects the large number of highly skilled workers employed in the banking industry.

The report also includes analysis of the UK's tax competitiveness for banking relative to other leading global financial centres. London (45.3 per cent) currently has a similar total tax rate for a typical corporate and investment bank as Frankfurt and Amsterdam (both 45.4 per cent), but higher than New York (27.4 per cent) and Dublin (32.1 per cent).

The report also contains forecasts of the total tax rates in 2024. For London, the forecasts are based on an increase in corporation tax from 19 per cent to 25 per cent and include potential scenarios for the bank surcharge paid by firms on UK profits.

Tax report 2022


Contact Information

UK Finance Press Office
020 7416 6750

Notes to editors

1. The 2022 Total Tax Contribution of the UK banking sector report is available here.

2. UK Finance is the collective voice for the banking and finance industry. Representing more than 300 firms across the industry, we act to enhance competitiveness, support customers and facilitate innovation

3. The chart above shows information on both the bank levy and the bank surcharge. These are different taxes that banks pay, but because they are similar in name they are sometimes confused with each other or the words used interchangeably. The bank surcharge is an additional rate of tax that banks pay on their profits in addition to the headline rate of corporation tax. The bank levy is a separate annual charge on certain balance sheet liabilities and equity of banks and building societies operating in the UK.