The government has announced plans for a new levy – the High-Value Council Tax Surcharge (HVCTS) – aimed at owners of residential properties in England worth £2 million or more.

This surcharge is scheduled to take effect in April 2028, with a public consultation on the detailed rules set to take place in early 2026.

At present, HVCTS will apply only to residential properties in England. It is not yet clear whether the devolved governments in Scotland, Wales or Northern Ireland will introduce similar measures.

Not Linked to Existing Council Tax Bands

Government information released after the Budget confirms that the surcharge will not be based on existing council tax bands. Therefore, if your property is currently classed in band F, G or H (using 1991 valuations), this does not automatically mean it will fall within the new surcharge.

Instead, a new valuation system will be introduced. The Valuation Office Agency (VOA) will undertake a targeted valuation exercise in 2026, with any property valued at £2 million or above being allocated to one of four new HVCTS bands.

Importantly, existing council tax bands will remain unchanged, and any variation to your council tax band will have no impact on HVCTS liability.

What You Should Consider

If you own property in London or other higher-value parts of England, this new surcharge may be something to plan for.

  • The surcharge may represent a notable ongoing expense from 2028.

  • Because it will rely on current market valuations rather than 1991 figures, properties that previously sat comfortably within lower council tax bands may now fall within the surcharge threshold if their present-day value exceeds the limit.

If you are concerned about how HVCTS might affect you, please get in touch. We would be pleased to offer tailored advice based on your circumstances.

See: https://www.gov.uk/government/news/high-value-council-tax-surcharge