Laws & Regulations
How much is the High Value Council Tax Surcharge?
The High Value Council Tax Surcharge (HVCTS) — sometimes called the "mansion tax" — is a proposed annual surcharge on residential properties in England valued at £2 million or more. The Treasury announced the policy at the 2025 Autumn Statement, with implementation targeted for April 2028. The proposed structure adds a banded surcharge on top of existing council tax, ranging from £2,500 per year for properties just above the £2 million threshold up to £7,500 per year for properties valued at £10 million and above.
Valuations will be determined by the Valuation Office Agency (VOA) using a fresh assessment based on 2026 market values, not the 1991 banding used for ordinary council tax. The surcharge is paid by the council tax-liable person — typically the resident owner — and is collected through the standard council tax bill. Final rates and thresholds will be confirmed in primary legislation expected during 2026 to 2027.
What this means in practice
A four-bedroom detached house in Wandsworth assessed by the VOA at £2.4 million in 2026 would fall into the lowest HVCTS band and face an additional £2,500 per year on top of the existing Band H council tax. An £8 million Belgravia townhouse would face £6,000 to £7,500 per year extra. A £1.95 million property pays nothing — the surcharge is a cliff-edge tax above £2 million, not a graduated one. Owners can appeal the VOA valuation through the standard council tax appeals route once the regime starts.
Related questions
Will the £2 million threshold be uprated for inflation?
The Treasury has indicated the threshold will be reviewed at each Spending Review but has not committed to automatic indexation. Without uprating, fiscal drag will pull more properties into scope each year — the OBR projects roughly 130,000 properties in England above £2 million in 2028, rising to around 200,000 by 2033 if thresholds stay frozen. Final indexation policy will be set out in the implementing legislation.
Does the surcharge apply to second homes and BTL properties?
Yes — the surcharge follows the property, not the owner's primary residence status. A £3 million second home in the Cotswolds owned by a London resident would attract HVCTS in addition to the existing council tax second-home premium (currently up to 100% in adopting councils). For buy-to-let landlords, the surcharge is the council tax-payer's liability — usually the tenant if they are the council tax-liable person under the tenancy.
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