The High Value Council Tax Surcharge, widely called the mansion tax, is a yearly charge on homes in England worth £2 million or more at April 2026 values, confirmed at the Budget on 28 October 2026. It is due to start in April 2028, costs £2,500 to £7,500 a year depending on the band, rises with inflation, and is paid by the owner on top of council tax.
The essentials
- Applies to
- Homes in England worth £2m or more at 2026 values.
- Starts
- April 2028, with bills from March 2028.
- Costs
- £2,500, £3,500, £5,000 or £7,500 a year, by band.
- Rises
- Each year with CPI inflation, from 2029/30.
- Paid by
- The owner, not the occupier.
- Collected by
- Local councils, alongside council tax.
- Valued by
- The Valuation Office, now part of HMRC.
- Revalued
- Every five years, first in 2033.
The bands
| 2026 value | A year | About a month (12 payments) |
|---|---|---|
| £2m to £2.5m | £2,500 | £208 |
| £2.5m to £3.5m | £3,500 | £292 |
| £3.5m to £5m | £5,000 | £417 |
| £5m and above | £7,500 | £625 |
Charges confirmed at the Budget on 28 October 2026 and being legislated in the Finance Bill 2026-27, so not yet law. They rise each year with CPI inflation from 2029/30. Monthly figures are rounded; the consultation proposed 12 monthly instalments, or 10 on request.
Because the charge rises every year, it adds up. If inflation averaged 5% a year, 20 years in the lowest band would come to about £82,700, and 20 years in the top band about £248,000. These are illustrations, not forecasts. See bands and thresholds.
How the value is set
The Valuation Office is carrying out a separate, targeted valuation of homes likely to be worth £2m or more. It will judge each home's value in 2026 against sales of similar homes, using automated models backed by valuers for unusual properties. Council tax bands, which still rest on 1991 values, play no part. More in how homes will be valued.
Who pays
The legal owner pays: freeholders, leaseholders with leases first granted for more than 21 years, trustees, companies and joint owners, who are each liable for the whole amount. Tenants and other occupiers do not. See am I affected?
If the band looks wrong
Owners will be able to correct factual mistakes when the draft list is published in autumn 2027, challenge their band within an initial 8-month window (6 months for a new owner), and appeal to the Valuation Tribunal for England. See challenges and appeals.
If you cannot afford it
Owner-occupiers on lower incomes or savings, or with certain disabilities in the household, may be able to defer the charge until the home is sold, with interest. See can't afford the charge?
What is still undecided
- The exact valuation date in 2026.
- The interest rate on deferred charges, and whether deferral needs the income test, the savings test or both.
- Discounts for homes tied to a job and homes owned by charities.
- How homes in a deceased person's estate are treated.
Also asked
Why is it called the mansion tax?
Mansion tax is the popular name. The government's name is the High Value Council Tax Surcharge, often shortened to HVCTS.
How much will the High Value Council Tax Surcharge raise?
The government estimates around £400 million a year from 2028/29. The Office for Budget Responsibility expects around 165,000 homes to pay in the first year.
Is the High Value Council Tax Surcharge law yet?
Not yet. It was announced in November 2025, consulted on from May to July 2026 and confirmed at the Budget on 28 October 2026. It becomes law when the Finance Bill 2026-27 is passed, with regulations setting the detail after that.
Last checked against the government's Budget documents and consultation response on 30 October 2026. The surcharge is being legislated in the Finance Bill 2026-27 and is not yet law. Some detail is still to come in regulations.