It slipped ahead in the record stakes after it was revealed previous favourite Bob the Builder would not be releasing a festive single.
Kate sings as Belle, a new character who was once in love with Scrooge, in the adaptation of the Charles Dickens classic.
Joint second favourites for the Christmas number one are Westlife and Atomic Kitten, followed by Madonna and Hear'Say and Robbie Williams and Nicole Kidman.
Kate said she would only let the song be released if the proceeds went to two charities chosen by her - the NSPCC and Sargeant Cancer Care for Children.
Her spokesman Robert Garlock said she did not intend to launch a singing career.