The chief executive of deVere Group has called for the government to scrap the High Value Council Tax Surcharge before its implementation in April 2028, arguing the tax will disproportionately affect ordinary homeowners whose properties have appreciated over time.
Nigel Green, CEO of the wealth management firm, said the tax fails to account for whether homeowners can afford the annual charges, which will range from £2,500 to £7,500 depending on property values.
“Many of these homes were bought decades ago by people on everyday salaries. They’ve simply watched prices rise around them,” Green said. “It’s a tax on paper wealth, and it takes no account of whether people can actually afford it.”
Tax structure and scope
The High Value Council Tax Surcharge will apply to homes in England valued above £2 million from April 2028. Properties valued between £2 million and £2.5 million will incur an annual charge of £2,500, rising in steps to £7,500 for homes valued above £5 million.
According to the Treasury, fewer than 1% of English homes are expected to cross the threshold. Revaluations will occur every five years, with charges rising with inflation from 2029/30. Draft bands will be published in autumn 2027, with the first bills issued in March 2028.
Green expressed particular concern about the impact on older homeowners. “Picture a widow living on her pension in the house she bought in the 1980s. She could soon be handed a bill of up to £7,500 every single year, on gains she can only reach by selling her home,” he said.
Valuation procedures
A document obtained by The Times under Freedom of Information laws details how inspectors will determine which homes are liable for the surcharge. The document states that inspectors can photograph properties from public highways, even where owners object.
Internal and external photographs are described as “essential”, providing a record where alterations, extensions or ongoing works are in question. Inspectors must obtain permission before entering a home. Where an owner refuses, the refusal and the owner’s name must be recorded.
HM Treasury stated that most properties can be banded using information the Valuation Office already holds, with visits needed only “in some limited circumstances”.
The valuation approach comes as London’s unsold high-end flats have tripled since 2016, indicating potential challenges in the upper end of the property market.
Market implications
Green warned that the scope of the tax is likely to expand over time. “The charges rise with inflation. Unless the threshold keeps up with house prices too, more families will be dragged in with every revaluation,” he said, drawing parallels with income tax thresholds.
The implementation of the surcharge comes at a time when the UK housing sales outlook has weakened to a three-year low, raising questions about the timing of additional property taxation.
Green argued that scrapping the tax “would cost the Government relatively little in revenue and win back a great deal of trust.”
Government response
A government spokesman defended the measure, stating: “HMRC’s approach is well-established and already used to ensure fair and accurate banding for millions of homes for council tax. In most cases, properties are valued without the need for a visit.”
The spokesman added: “The surcharge addresses a longstanding unfairness where a Band D home in Darlington pays more in council tax than a £10 million mansion in Mayfair and will apply to less than 1% of properties in England.”
HMRC confirmed there are strict guidelines on photographing properties and that the process is designed to ensure homes are valued correctly “to ensure the right tax is collected, no more, no less”.
The debate over the surcharge highlights ongoing tensions between tax reform aimed at addressing perceived inequities in the property tax system and concerns about the impact on homeowners who have seen significant property appreciation through no active investment of their own. With implementation scheduled for April 2028, the government faces continued scrutiny over the practical and financial implications for affected households.
