Legal News | 4.06.26
England’s “mansion tax”: Government consults on proposals
In January, we wrote about the proposed introduction of a new ‘High Value Council Tax Surcharge’ (HVCTS) for owners of residential properties in England from April 2028. Rumoured in the run-up to multiple Budgets, the Chancellor announced in November 2025 that residential properties with a value greater than £2 million would be subject to a surcharge in addition to existing Council Tax liabilities. That article made reference to a future Government consultation, which has now been published.
The consultation seeks views on how the HVCTS should be designed, including possible discounts and exemptions, support mechanisms for those who cannot pay, how billing and administration of the surcharge will work (including the approach to housing valuations) and how homeowners can challenge their banding or liability.
The consultation is detailed (and is at this stage only a proposed framework for the surcharge) but there are important points to note, including:
- Liability of trustees: the Government proposes that trustees holding residential property subject to the HVCTS will be liable for the charge (and where there is more than one trustee, those trustees will be jointly and severally liable). Where a property is held on bare trusts, the trustees will also be liable (even though in a bare trust arrangement, the beneficiary has an absolute right to the property and income from it);
- A ‘non-resident premium’: the consultation asks whether there could be a case for applying an additional HVCTS ‘premium’ to non-UK resident owners of homes which are liable for the charge, citing pressures on house prices and availability potentially caused by non-resident owners; and
- Support for those who may be ‘asset rich but income poor’: the Government acknowledges that any surcharge will be paid by homeowners based on property prices, rather than the income of homeowners. This may leave those with lower incomes (but with high value property assets) in a difficult position when it comes to paying. The Government is proposing to introduce a deferral scheme for those immediately unable to pay which will see HVCTS collected when the property is disposed of (subject to certain eligibility criteria).
The consultation closes on 14 July 2026. In the meantime, if you have any questions about the proposals or your own estate planning, please contact our Private Client Team at wealth@wansbroughs.com.
