URGENT UPDATE: Major changes to council tax regulations have just been announced by HMRC, impacting homeowners across England. Starting in April 2028, a new High Value Council Tax Surcharge, commonly known as the ‘mansion tax’, will impose an additional annual charge on properties valued over £2 million.
The new levy will range between £2,500 and £7,500, with the highest amount applicable to homes worth £5 million and above. This significant financial burden is expected to affect around 200,000 properties, primarily in London, the South East, and the East of England.
During a recent session with MPs, Jonathan Russell, chief executive of the Valuation Office Agency (VOA), outlined the agency’s approach to implementing these changes. The VOA, operating under HMRC, is responsible for valuing approximately 28 million residential properties across England and Wales.
“We want people to have confidence in the valuations that we produce,” said Russell. “We will ensure transparency about how we are conducting these valuations.”
Officials will utilize existing valuation data from 1991 while also assessing current market conditions through open-source data, including information from the Office for National Statistics and Land Registry. The aim is to provide accurate assessments that reflect today’s property values rather than outdated figures.
Russell emphasized the importance of identifying properties that may fall within the new surcharge’s criteria, noting that they will examine homes with indicative valuations as low as £1.5 million to ensure no properties are overlooked. “We will not spend too much time looking at those clearly above £5 million,” he stated.
The appeals process for the new surcharge is still under development. Russell confirmed that legislation and consultations will be required to establish how homeowners can challenge their council tax banding. “Plans for consultation will begin in the coming months,” he added, indicating that discussions will include reliefs and ownership complexities.
This impending tax change will have profound implications for high-value homeowners, particularly in affluent areas. The financial strain of additional charges could significantly impact lifestyle choices and investment strategies for many families.
As the Autumn Budget 2025 continues to unfold, these developments signify a crucial shift in how council taxes are structured in England. Homeowners are urged to stay informed as more details emerge.
For ongoing updates on this developing story and other financial news, keep an eye on trusted sources and government announcements.
