The New High Value Council Tax Surcharge

Big Homes, Bigger Bills: The New High Value Council Tax Surcharge

*The information in this blog relates to England and Wales only

If you own a mansion, the government is coming for a slice of your council tax. In the 2025 UK Budget, chancellor Rachel Reeves introduced a brand-new ‘High‑Value Council Tax Surcharge’, set to hit expensive homes in England from April 2028, with annual charges of £2,500 per year for homes worth over £2 million and £7,500 per year for homes worth over £5 million.

This will be in addition to normal council tax, not a replacement. So, if you thought owning a luxury property was just about mortgage and maintenance, think again.

The government calls it a “fair contribution” from owners of the UK’s priciest properties. Critics call it a “mansion tax by stealth.” Either way, it’s set to raise hundreds of millions each year, while finally updating a system where council tax is still based on 1991 property values.

The surcharge kicks in April 2028, after a revaluation of properties based on 2026 values. The bands will then be updated each year for inflation, meaning if your property keeps rising in value, so does your bill.

Are you planning to buy a property over £2 million? Add this surcharge to your affordability calculations. Do you already own a home over £5 million? You’re looking at an extra £7,500 a year, every year. For anyone holding a high-value home, this is a prompt to rethink costs and long-term plans – the luxury lifestyle just got a little more expensive!

Big houses, big responsibilities – and now, bigger council tax bills. The High‑Value Council Tax Surcharge is a clear signal: if your property is in the top tier, expect to pay up. Plan early, budget carefully, and don’t be caught off guard. Speak to a member of our team today.

The information and opinions contained in this blog are for information only.  They are not intended to constitute advice and should not be relied upon or considered as a replacement for advice.  Before acting on any information contained in this blog, please seek solicitor’s advice from Gilson Gray.