UK and International Tax news
Consultation on the High Value Council Tax Surcharge
Thursday 21st May 2026
The Government is seeking views on the detailed design of the High Value Council Tax Surcharge, a new charge on owners of residential properties in England worth £2 million and above, which was announced in the 2025 Budget.
From April 2028, the HVCTS will increase the tax paid by owners of high value residential property, raising revenue from those with the top 1% most valuable properties in England to support funding for local government services and to reduce the largest inequalities in the Council Tax system.
The consultation is seeking views on the detailed design of the HVCTS, proposed scope, a deferral mechanism to support those who cannot pay, the billing process, the proposed appeals process, administration and enforcement mechanisms, and the equalities impacts of the proposed approach.
The HMRC’s Valuation Office will be conducting a targeted valuation exercise to identify properties in scope. Properties will be placed into one of four bands based on their value with a corresponding charge. Charges will be uprated in line with the CPI annually. Revaluations will be conducted every five years with the next revaluation to take place in 2033. Decisions on whether to uprate bands will be taken alongside revaluations and will therefore be for a future government.
Properties built after implementation of the HVCTS (April 2028) but before the next scheduled revaluation will be valued and banded either on completion or from the day they are occupied, as is the case with Council Tax. Properties which have been significantly improved or changed after the implementation date, for example by adding a large extension, will be revalued and banded at the sooner of either the next revaluation or sale of the property.
Proposed HVCTS charging structure
| Threshold | Charge |
| £2 million to £2.5 million | £2,500 |
| £2.5 million to £3.5 million | £3,500 |
| £3.5 million to £5 million | £5,000 |
| over £5 million | £7,500 |
In the vast majority of properties, it is expected that HVCTS will be paid by the same taxpayer as Council Tax. However, where Council Tax is paid by occupiers, for the most part HVCTS will be paid by the owners of the properties.
The HVCTS is forecast to raise around £430 million of revenue per year from 2028/29 which will support funding for local government services. Local authorities are to be fully compensated for the additional costs of administering HVCTS.
If you would like more information on the consultation, please contact Keith Rushen on 0207 486 2378.
Contact Us