The Autumn Budget 2025 included the announcement of government plans to introduce a new levy, the High-Value Council Tax Surcharge (HVCTS), for owners of residential properties in England valued at £2 million or more.

The surcharge is expected to come into effect in April 2028. A public consultation on the details will be held in early 2026.

HVCTS currently only affects residential properties in England. Whether the devolved administrations in Scotland, Wales and Northern Ireland will follow suit remains to be seen.

Not Based on Council Tax Bands

In information published following the Budget, the government confirmed that the surcharge will not be calculated based on council tax bands. So, if your property is currently in say bands F, G, or H (which were set based on 1991 values), this does not necessarily mean your property will be subject to a surcharge. 

Instead, there will be a fresh valuation process. The Valuation Office Agency (VOA) will carry out a targeted valuation exercise in 2026. Properties assessed at £2 million or more will be slotted into one of four new HVCTS bands.

As far as council tax is concerned, existing council tax bands will remain in place, and a change in council tax band will not affect HVCTS eligibility.

What to Do Next

If you own a high value property the new surcharge is bound to be a concern.

• The surcharge could add a significant recurring cost from 2028.

• As the surcharge uses up-to-date property valuations (not 1991 values), properties that escaped high ‘band’ classification under the old system could now be subject to it if their current market value is high.

If you have concerns about how the new surcharge will affect your situation, please do get in touch. We’re happy to give you personalised advice as soon as we have more information.

You can see the current guidance in full here.