BREAKING: Major changes to council tax are on the horizon, impacting homeowners across England and Wales. The UK government has just confirmed a new High Value Council Tax Surcharge, commonly referred to as the ‘mansion tax,’ which will come into effect in April 2028.
This significant change means that homeowners with properties valued over £2 million will incur an additional annual charge ranging from £2,500 to £7,500. Those with properties valued at £5 million and above will face the maximum surcharge, raising concerns among affluent residents.
During a recent session with Members of Parliament, Jonathan Russell, chief executive of the Valuation Office Agency (VOA), outlined the steps his agency is taking to implement this new charge. The VOA, operating under the umbrella of HMRC, is responsible for valuing roughly 28 million residential properties across England and Wales.
Russell explained, “We already have the basic valuation that we use to value properties for council tax banding, which was done in 1991. We are looking at the data we hold already to ensure that it is up to date and accurate.” The agency will utilize existing data from the Office for National Statistics, the Land Registry, and sales data to assess property values accurately.
Around 200,000 properties are expected to fall under this new surcharge, with a significant concentration in London, the south east, and the east of England. Russell noted that many homes in these regions will be subject to the new tax, while some local authorities might not have any properties affected at all.
In response to concerns about the valuation process, Russell indicated that they will focus on homes with indicative valuations of around £1.5 million to ensure accuracy without overlooking any properties that qualify for the surcharge. He stated, “We will be looking at the ones in between those two levels to ensure we get the banding absolutely accurate.”
Additionally, Russell addressed the appeals process for affected homeowners, indicating that it will require new legislation and public consultation. Plans for this consultation are expected to unfold in the coming months. He emphasized the importance of transparency, stating, “We want people to have confidence in the valuations that we produce.”
This new tax is poised to have an immediate financial impact on wealthier homeowners, prompting discussions about the potential for appeals and reliefs. As more details emerge, homeowners are encouraged to stay informed about how this change may affect their finances.
Stay tuned for updates on this developing story as the consultation process progresses and further details are released. For ongoing financial news and tips, visit the Everything Money website.
