If you own property, you've probably seen growing speculation about whether new Prime Minister Andy Burnham could introduce a UK wealth tax. Well, while Burnham has indicated that introducing such a tax is not a government priority, he has not ruled it out either.
Property owners are already facing a series of measures that increase the cost of holding or passing on wealth – a confirmed mansion tax on £2 million+ homes, higher tax on rental income from 2027, and Inheritance Tax thresholds frozen until 2031. So, perhaps the real question isn’t whether a tax labelled “wealth tax” will appear. Perhaps it is whether the tax you already pay on your property is climbing. It is.
In this article, we'll examine Burnham's position on a wealth tax and what landlords and property investors should be watching as a new prime minister enters office.
Key Takeways
- The UK does not have an annual wealth tax as of 20 July 2026
- New Prime Minister Andy Burnham has said introducing a UK wealth tax “wouldn't be a priority,” although he has previously supported reforms that would increase taxes on higher-value property and land holdings
- The High Value Council Tax Surcharge will introduce higher annual charges for homes valued at £2 million or more from April 2028; annual surcharges will range from £2,500 to £7,500, depending on the property's value
- One of the most widely discussed wealth tax proposals is a 2% annual levy on individual net assets above £10 million
- The proposal has been supported by organisations like Tax Justice UK and Oxfam, which estimate it could raise around £24 billion a year from roughly 20,000 of the UK's wealthiest individuals
- Property accounts for around 40% of household wealth in the UK; because residential property is the country's largest store of private wealth, almost every proposed UK wealth tax would rely heavily on property valuations
- The UK already taxes property wealth in several ways, including Council Tax, SDLT (or LTT and LBTT in Wales and Scotland), CGT, IHT and the Annual Tax on Enveloped Dwellings
- Although these taxes serve different purposes and are not wealth taxes, together they already impose significant taxes on owning, buying, selling and passing on property
Does the UK Actually Have a Wealth Tax Right Now?
No. As of 20 July 2026, the UK does not have an annual wealth tax. There is no tax that charges individuals each year based on the total net value of everything they own, such as property, investments, business assets and cash. No annual wealth tax is currently in force, and there is no legislation before Parliament to introduce one.
Instead, the UK taxes wealth through several separate taxes. Property owners may pay Council Tax, Stamp Duty Land Tax (SDLT)/Land Transaction Tax (LTT) in Wales/Land and Buildings Transaction Tax (LBTT) in Scotland), Capital Gains Tax (CGT) when they sell an asset at a profit, Inheritance Tax (IHT) on estates above the available tax-free thresholds, and, in some cases, the Annual Tax on Enveloped Dwellings (ATED) for certain high-value residential properties held by companies.
All these taxes collectively create a substantial tax burden for property owners even without a standalone wealth tax.
Will Andy Burnham Introduce a UK Wealth Tax?
Probably not, based on what he’s said publicly. Burnham, who became Prime Minister on 20 July, succeeding Keir Starmer after winning the Makerfield by-election in June and taking the Labour leadership, has been non-committal on an annual wealth tax. He’s signalled it “wouldn’t be a priority” and has reaffirmed Labour's 2024 manifesto commitment not to increase the main rates of Income Tax, VAT or National Insurance.
That does not necessarily mean property taxes will remain unchanged. Throughout his political career, Burnham has argued that land and property are taxed inefficiently, has expressed support for Land Value Tax-style reforms, and has repeatedly criticised Council Tax for relying on property valuations from 1991 in England and Scotland.
So, rather than introduce a standalone wealth tax, he may focus on property taxation. Ahead of this year’s Autumn Budget, property owners may need to watch for changes to Council Tax, high-value property taxes and land taxation.
Speaking of Property Taxes, Will the Mansion Change Under Andy Burnham?
No. As of 20 July 2026, Andy Burnham has not announced any plans to change the High Value Council Tax Surcharge, popularly known as the mansion tax. The policy remains as set out in the Autumn Budget on 26 November 2025, with annual surcharges applying from April 2028 to residential properties valued at £2 million or more. According to HM Treasury's Autumn Budget 2025 and the Government's High Value Council Tax Surcharge consultation, the surcharge will be paid by the property owner alongside Council Tax.
The surcharge is a fixed annual fee based on the property's value, not a percentage of its worth.
Property Value | Annual Surcharge |
|---|---|
£2 million to £2.5 million | £2,500 |
£2.5 million to £3.5 million | £3,500 |
£3.5 million to £5 million | £5,000 |
Over £5 million | £7,500 |
According to the Office for Budget Responsibility's Economic and Fiscal Outlook published in November 2025, the surcharge is expected to affect around 165,000 homes in its first full year.
The policy's finer details are still being finalised. The Government's High Value Council Tax Surcharge consultation, which closed on 14 July 2026, sought views on issues including reliefs, exemptions and whether asset-rich but cash-poor homeowners should be able to defer payment. As of 20 July 2026, the Government has not yet published its response.
There has also been media speculation that the £2 million threshold could be reduced to £1.5 million, bringing significantly more properties within the surcharge. However, no such proposal has been announced or included in draft legislation.
For now, the policy remains unchanged. Even at the current threshold, however, the surcharge is expected to affect more than just traditional mansions, particularly in London and parts of the South East, where decades of house price growth have pushed many ordinary family homes above the £2 million mark.
Worked Example: How a £2.15 Million Family Home Could Face an Extra £2,500
James and Sophie bought a four-bedroom Victorian terrace in south-west London in 2006 for £720,000. They still live there today, and recent sales of similar homes suggest their property is now worth around £2.15 million. They have never treated it as an investment. It has simply increased in value over two decades of house price growth.
Before the High Value Council Tax Surcharge, they paid an illustrative Council Tax figure of £4,000 a year.
From April 2028, their tax bill may become:
- Council Tax = Remaining £4,000 (illustrative)
- High Value Council Tax Surcharge = £2,500
- Total Annual Property Tax = Approximately £6,500
That represents an additional £2,500 every year simply because the property's market value exceeds the £2 million threshold.
The family's rising property value could also have wider tax implications. If James and Sophie's estate exceeds the available Inheritance Tax allowances, including any applicable Residence Nil-Rate Band, more of the property's value could ultimately fall within the scope of Inheritance Tax, especially while the standard £325,000 Nil-Rate Band remains frozen. The exact outcome would depend on their wider estate, ownership structure and estate planning
Which UK Wealth Tax Proposals Are Being Discussed?
Several wealth tax proposals are currently being discussed, but none is Government policy. Some of the most widely discussed ones include:
- Tax Justice UK & Oxfam – A 2% annual tax on net wealth above £10 million, affecting around 20,000 people (approximately 0.04% of the UK population). Supporters estimate it could raise around £24 billion a year, although the final figure would depend on taxpayer behaviour and the design of the tax.
- Green Party - A wealth tax of 1% on wealth above £10 million and 2% on wealth above £1 billion. The party estimates the policy could raise around £15 billion annually, although some independent estimates have suggested lower figures.
- Trades Union Congress (TUC) - A progressive wealth tax with rates rising to 3.5% on the largest fortunes, which the TUC has estimated could raise around £10 billion a year.
However, according to the Wealth Tax Commission's 2020 final report, an annual wealth tax would face significant practical and political challenges. Nonetheless, it concluded that a one-off wealth tax could be designed and administered successfully.
The Institute for Fiscal Studies (IFS) has also been sceptical of an annual wealth tax. According to the IFS, a wealth tax would be a “poor substitute for properly taxing the sources and uses of wealth,” arguing that governments should focus on improving existing taxes rather than creating a new one.
For property owners, this matters because debates about wealth taxation often overlap with discussions around Capital Gains Tax, Inheritance Tax, Council Tax and other property-related taxes.
Why Are Property Investors the Most Exposed?
Because property makes up the largest share of household wealth in the UK and, unlike most financial assets, it cannot be moved or relocated. According to the Office for National Statistics' Wealth and Assets Survey, property accounts for around 40% of total household wealth. Although the survey lost its Accredited Official Statistics status in June 2025 following concerns about declining response rates, it remains the UK's most comprehensive source of household wealth data.
Residential property is relatively easy to identify, value and tax too. Every home has a registered owner, a market value and a fixed location, making residential property very visible. That is why many proposals to increase taxes on wealth place property at the centre of the debate.
You can already see this in the way the UK's tax system treats property. Buying a property can trigger SDLT (or its Welsh and Scottish equivalents). Owning one means paying Council Tax and Annual Tax on Enveloped Dwellings (ATED) if it is held through a company. Selling it may give rise to CGT, while passing it on through your estate can bring IHT into play.
Taken individually, these taxes serve different purposes. Together, however, they mean property is taxed repeatedly throughout its lifetime, from purchase and ownership to disposal and inheritance. That is why property investors are likely to remain among the first groups affected whenever governments look for new ways to raise revenue from wealth.
Conclusion
If you're waiting to see whether a tax officially called a “wealth tax” arrives, you may be watching the wrong door. The real story is that the UK already has a tax system built to capture property wealth. Rather than introducing an entirely new tax, governments can raise more revenue simply by tightening the rules that already exist, whether that's freezing tax thresholds, increasing property charges or reforming the way high-value homes are taxed.
The good news is that property tax is one of the few areas where planning can make a meaningful difference. The earlier you understand your exposure, the more opportunities you have to review ownership structures, consider estate planning and avoid unnecessary tax liabilities before they crystallise.
UKPA Can Help!
If you're unsure what the present situation means for your property or portfolio, book a free 15-minute discovery call with us. Our property tax specialists will assess your circumstances, explain where your biggest tax exposures may lie and discuss options, so you can make informed decisions before small tax changes become expensive problems.
FAQs
No. As of 20 July 2026, there is no UK wealth tax. Instead, wealth is taxed through separate taxes such as Capital Gains Tax, Inheritance Tax, Council Tax, Stamp Duty Land Tax (or its Welsh and Scottish equivalents) and the Annual Tax on Enveloped Dwellings. Although several organisations have proposed introducing a UK wealth tax, no such measure is Government policy or before Parliament.
The 60% tax trap is not a separate tax. It refers to the effective marginal Income Tax rate paid by people earning between £100,000 and £125,140. Within this income band, the Personal Allowance is reduced by £1 for every £2 of adjusted net income above £100,000. According to HMRC's Income Tax guidance, the Personal Allowance is fully withdrawn once adjusted net income reaches £125,140, meaning many taxpayers effectively lose 60p of every extra £1 they earn.
There is no tax officially called a “wealth gain tax” in the UK. The term usually refers to Capital Gains Tax, which is charged on the profit made when selling or disposing of assets such as investment property or shares.
According to Tax Justice UK and Oxfam GB, a 2% annual UK wealth tax on individual net assets above £10 million could raise around £24 billion a year while affecting approximately 20,000 people, or around 0.04% of the UK population.
The mansion tax, formally called the High Value Council Tax Surcharge, will apply from April 2028 to homes valued at £2 million or more. And annual charges will range from £2,500 for properties worth £2 million to £2.5 million up to £7,500 for properties worth more than £5 million.
Not under current law. As of 20 July 2026, there is no UK wealth tax, so owning a rental property does not attract an annual tax based solely on its value.
There is no single proposed UK wealth tax rate because different organisations have suggested different models. The best-known proposal, backed by Tax Justice UK and Oxfam GB, is a 2% annual tax on individual net wealth above £10 million. The Green Party has proposed a graduated wealth tax, while the Trades Union Congress (TUC) has suggested a tiered tax rising to 3.5% on the largest fortunes.
No. Inheritance Tax is not the same as a UK wealth tax. A wealth tax is generally an annual charge on the total value of a person's net assets, whereas Inheritance Tax is normally charged when someone dies or, in some cases, on certain lifetime gifts. Although both taxes apply to accumulated wealth, they operate in different ways. According to HMRC's Inheritance Tax Manual, the standard Nil-Rate Band is £325,000, with an additional Residence Nil-Rate Band available to eligible estates.
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