Hannah Catt writes in PrimeResi on the upcoming High-Value Council Tax Surcharge in the UK and why it needs careful design

The proposed High Value Council Tax Surcharge marks a significant shift in the taxation of high-value residential property in the UK, with liability moving to homeowners rather than occupiers and annual charges proposed for properties valued above £2 million. The surcharge is expected to take effect from April 2028, with properties assessed using 2026 values and reviewed every five years. 

Although the consultation has now closed, several important details remain unresolved. Valuation methodology will be central to how the regime operates in practice, particularly for properties close to the £2 million threshold, where small differences in evidence, timing or property condition could determine whether a home falls within scope. 

A fair and efficient appeals process will also be important to avoid prolonged uncertainty for homeowners, buyers and the wider prime property market. The article notes that uncertainty around banding, deferral arrangements and the treatment of newly built or substantially improved properties could create practical challenges if the regime is not carefully designed.

The surcharge also raises questions for asset-rich, income-poor homeowners, landlords, trustees, developers and non-UK resident owners. While the proposed deferral scheme is intended to assist some homeowners, the criteria may be narrow, and any deferred debt is expected to be secured against the property and subject to interest. 

Hannah Catt, Senior Associate in our Private Property team, writes in PrimeResi: 

The outcome of the consultation remains to be seen - but it marks an opportunity for the sector at large to not only refine the HVCTS itself, but to shape the foundations of any broader move toward value-based property taxation.

Read the full article in PrimeResi here.