High-Value Council Tax Surcharge
We help you prepare for the new mansion tax coming April 2028. From VOA valuation assessments to ownership restructuring and penalty mitigation, we provide comprehensive support to protect high-value property owners from unexpected tax burdens.
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The "Mansion Tax" is the commonly used term for the High Value Council Tax Surcharge (HVCTS), a new annual charge on owners of residential properties in England valued at over ÂŁ2 million. This measure was announced by Chancellor Rachel Reeves in the Autumn Budget on 26 November 2025 and is intended to take effect from April 2028.
The policy aims to address what the Government describes as inequity in the current council tax system, where properties valued in the millions may pay similar amounts to more modest homes due to the outdated 1991 valuation basis of council tax bands.
According to Government estimates, fewer than 1% of properties in England are expected to be above the ÂŁ2 million threshold. The Office for Budget Responsibility forecasts that the measure will raise approximately ÂŁ400 million annually from 2029 onwards.
Threshold: ÂŁ2 million property value
Annual charge: ÂŁ2,500 to ÂŁ7,500
Start date: April 2028 (intended)
Valuation date: 2026 market values
Liable party: Property owners
Applies in: England only
Properties affected: Under 1% nationally
The following details have been published by HM Treasury and represent the Government's stated policy intention:
The Government has confirmed that a public consultation will be held in early 2026 to consider the following matters:
Until the consultation is complete and legislation is enacted, there remains significant uncertainty about the practical application of the surcharge. Property owners, advisers, and the wider industry await further clarity on these important details.
The Government has published four value bands with corresponding annual surcharges. These amounts are in addition to existing council tax liabilities:
High Value Council Tax Surcharge Bands (from April 2028) | |
|---|---|
Property Value Band | Annual Surcharge |
ÂŁ2 million to ÂŁ2.5 million | ÂŁ2,500 |
ÂŁ2.5 million to ÂŁ3.5 million | ÂŁ3,500 |
ÂŁ3.5 million to ÂŁ5 million | ÂŁ5,000 |
ÂŁ5 million and above | ÂŁ7,500 |
Source: HM Treasury, High Value Council Tax Surcharge factsheet, 26 November 2025
26 November 2025
Chancellor announces High Value Council Tax Surcharge in Budget 2025
Early 2026
Public consultation on detailed implementation (expected)
2026
Valuation Office Agency conducts property valuations for 2026 market values
April 2028
Surcharge intended to come into effect
2029 onwards
Annual CPI indexation of surcharge amounts begins
Based on the Government's published guidance, the surcharge is expected to affect owners of residential properties in England valued at over ÂŁ2 million at the 2026 valuation date. This includes:
Properties above the ÂŁ2 million threshold are heavily concentrated in London and the South East. In prime London locations, the threshold may capture family homes and flats rather than only the large detached properties the term "mansion tax" might suggest.
Key Concerns
The new High Value Council Tax Surcharge (commonly called the mansion tax) targets owners of residential properties valued over ÂŁ2 million. From April 2028, you could face annual charges of up to ÂŁ7,500 on top of your existing council tax.
The High Value Council Tax Surcharge introduces a new layer of complexity to property ownership. While we do not carry out property valuations, our specialist tax team can help you navigate the tax planning, compliance, and strategic considerations that arise from this new charge.
We review your property ownership to ensure it’s tax-efficient under the mansion tax, assessing ATED, corporation tax, income tax, CGT, and inheritance tax to recommend the best strategy.
While we don’t provide valuations, we work with your surveyor or valuation professional to help you understand VOA banding thresholds and present evidence effectively if challenging an assessment.
For clients with multiple properties, we calculate total mansion tax exposure and its effect on rental yields, investment returns, and holding costs to guide retention, restructuring, or disposal.
Once the surcharge applies, we help with ongoing compliance, integrating mansion tax into your cashflow and tax planning, and ensuring landlords account for it correctly in rental records.
We advise on ownership changes that could reduce your tax burden, including moving properties into or out of companies or trusts, considering mansion tax and other property taxes.
The mansion tax doesn’t stand alone. We assess its impact alongside ATED, SDLT, CGT, and inheritance tax to provide a complete view of your property tax position.
Disclaimer
The High Value Council Tax Surcharge (Mansion Tax) rules are subject to final confirmation following government proposals. All valuations, liability estimates, and planning scenarios presented here are indicative and for illustrative purposes only. We provide guidance based on current proposals and professional judgment.
Be the first to know the potential annual surcharge you could face on your high-value property from April 2028 onwards.
Our Process
Our Four-Step Mansion Tax Planning Process:
We review your property portfolio, estimate 2026 VOA valuations, and calculate potential mansion tax exposure
We develop a comprehensive plan to minimise liability through valuation challenges, ownership restructuring, or portfolio optimisation.
We execute the strategy, managing VOA communications, ownership transfers, and all documentation
We handle annual compliance, payment planning, and adapt your strategy as regulations evolve
Related Services
We are committed to helping you achieve financial prosperity while optimising your tax position in the most effective and efficient way possible.
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Our latest news on Mansion Tax
No. The High Value Council Tax Surcharge was announced in Budget 2025 and represents the Government's policy intention. However, the detailed legislation has not yet been enacted. A public consultation is planned for early 2026, and the measure is intended to come into effect from April 2028.
The Valuation Office Agency will conduct a targeted valuation exercise based on 2026 market values. The detailed methodology is subject to consultation. Revaluations will occur every five years thereafter.
The announced surcharge applies to properties in England only. Scotland and Wales have their own devolved tax arrangements for property. Wales has announced separate council tax reforms planned for 2028.
The Government has indicated that reliefs and exemptions will be considered as part of the 2026 consultation. The OBR's costings assume some current council tax exemptions may apply and that deferral schemes may be available for those unable to pay immediately.
The design of an appeals system is subject to consultation. Details of how property owners can challenge valuations will be confirmed following the consultation process.
Yes. The surcharge is levied on property owners, not occupiers. This means landlords of buy to let properties valued over ÂŁ2 million will be liable for the surcharge, not their tenants.
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