The government has consulted on plans for a mansion tax that would add a High Value Council Tax Surcharge to some homes from April 2028, with the charge paid by the owner rather than the person living there. The proposal, announced in the 2025 Autumn Budget, would start at £2,500 a year for homes worth between £2m and £2.5m.
Properties valued at £2.5m to £3.5m would pay £3,500 a year, while homes in the £3.5m to £5m band would face £5,000 a year. Houses worth more than £5m would be charged £7,500 a year, according to the consultation on the high-value surcharge.
The policy is aimed at homes valued at £2m or more and would sit on top of existing council tax. In some cases, the owner liable for the surcharge will be the leaseholder, which means the bill will not always fall on the person occupying the property.
Sarah Coles, head of personal finance at AJ Bell, said the cost “won't break the bank” for those on high incomes, a comment that captures the basic political logic behind the plan: the charge is designed to raise more from the top end of the housing market without landing on most ordinary households. That makes the surcharge easier to defend than a broad-based property tax rise, but it also means the government is betting on a narrow slice of owners to carry the political weight of the measure.
The timing matters because the levy is not immediate. The mansion tax was announced in the 2025 Autumn Budget, but the surcharge is expected to be added to council tax only from April 2028, leaving a long run-up for owners, lenders and landlords to plan around the new bands. The scale is straightforward, but the burden may be less so in practice, especially where leasehold ownership complicates who actually pays.
For now, the key point is that the surcharge is moving from idea to structure. Anyone with a property valued at £2m or above would be in scope, and the higher the value, the higher the annual bill. What remains is whether the government sticks with the bands it has set out, because the difference between a symbolic tax and a real one is not the name on the policy, but the charge on the bill.
