The UK's Office for National Statistics has flagged that the latest set of government borrowing figures contained an error that wrongly inflated the size of the public deficit.
HM Revenue and Customs was at fault in this instance, with a mistake in the amount of value added tax (VAT) supplied to ONS that was used in its calculations of the current UK government budget deficit, which was published last month and showed the highest August figure in five years.
The error only affected the budget deficit and public sector net borrowing figures for the period between January and August 2025, ONS said.
New borrowing data scheduled for 21 October will include corrections for this error, alongside regular updates.
"Correcting for the error reduces public sector net borrowing by between £200 million and £500 million per month within the period affected, resulting in a reduction in borrowing of £1 billion for the financial year ending March 2025, and a reduction of £2 billion for the financial year to date (April to August 2025)," the ONS said.
This did not have an impact on central government net cash requirement, public sector net debt, or public sector net financial liabilities.
"Public sector finances statistics are compiled on a National Accounts (accrued) basis while HM Revenue and Customs statistics are published on a cash basis.
"This means that although the overall magnitude of the impact is similar, the impact of the error on public sector finances statistics, particularly the time period affected, differs from the impact on statistics published by HM Revenue and Customs."
HMRC said in its own statement that it identified the error in its VAT cash receipts outturn and had since revised this series in its latest publication released today, where VAT cash receipts from April to August increased by £2.4 billion because of the revision.