The Mansion Tax Is Coming: What £2m+ London Owners Need to Know Before April 2028

For the past year, prime London owners have been braced for a “mansion tax” without knowing what it would actually look like. That changed this year. The High Value Council Tax Surcharge is no longer speculation — it is confirmed government policy, it has a start date, and the consultation that will fix its final detail has already closed. If you own a home worth £2 million or more, the question is no longer whether this applies to you. It is what you do about it before it lands.

What the surcharge actually is

The High Value Council Tax Surcharge is an annual charge on residential property in England valued at £2 million or above, payable on top of existing council tax from April 2028. It is levied on owners rather than occupiers and will be collected by local authorities alongside the existing council tax system, with properties placed into value bands carrying fixed annual charges.

Early figures put the charge at somewhere between £2,500 and £7,500 a year depending on the band a property falls into — a manageable sum for some, an unwelcome new fixed cost for others, particularly owners with several qualifying properties.

The numbers behind it

Around 110,000 homes in England currently sit above the £2 million threshold. That is under 0.5% of the national housing stock, but the geography is telling: roughly 90% of those homes are in London and the South East. This was never a tax aimed at the country as a whole. It is, in practice, a prime London tax with a national name.

The government's own estimate puts annual revenue from the surcharge at around £430 million once it beds in from 2028. For context on how these things tend to evolve, more than one valuation and tax adviser has already suggested the initial bands should be read as introductory rates rather than a ceiling.

The non-resident premium nobody's talking about yet

Buried inside the same consultation is a proposal that matters more to our clients than the base surcharge itself: an additional premium specifically for non-UK resident owners. Nothing is confirmed, but the direction of travel is clear enough — government has explicitly flagged concern that overseas ownership in high-pressure markets like London may be contributing to affordability pressure, and a non-resident premium is the obvious lever to pull.

We have written before about how American and Turkish buyers are quietly reshaping demand at the top of this market. A meaningful chunk of that demand is international. Any additional levy aimed specifically at non-resident owners is worth watching closely if you fall into that category, or if you are relying on overseas buyer demand to support a future sale price.

What this means if you're selling — or sitting tight

Two years feels like a long runway until you consider how prime property transactions actually move. A considered sale — valuation, positioning, discreet marketing or an off-market introduction, negotiation, legal completion — routinely takes six to twelve months for the right buyer at the right price. Owners who wait until 2027 to start thinking about this will be making decisions under far more time pressure than owners who start the conversation now.

For owners not planning to sell, the practical step is simpler: understand which band your property is likely to fall into once the response to the consultation is published, and build the additional annual cost into your holding calculations — particularly if you own more than one qualifying property, including HMO or multi-unit portfolios where several titles could each cross the £2 million line individually.

How we're advising clients to get ahead of it

Three conversations are happening with clients right now. First, portfolio landlords and HMO owners reviewing whether individual assets crossing the £2 million threshold still make sense to hold once the surcharge and existing licensing costs are added together — we've seen this exact calculation push several HMO owners toward a sale this year already. Second, owners of single high-value homes weighing whether to bring a sale forward into 2026 or 2027, ahead of both the surcharge and whatever the finalised bands turn out to be. Third, overseas owners wanting a clear-eyed read on the non-resident premium risk before committing further capital to the London market.

None of these are decisions to make from a headline. They depend on your specific property, your ownership structure, and your timeframe — which is exactly the kind of detail that gets lost when a story like this gets flattened into a single tax rate on the news.

I've spent over 40 years in this market, and policy changes like this tend to reward owners who move early and quietly over those who wait for certainty that never fully arrives. I don't make excuses. I make results — and right now, that means giving clients an honest, specific read on what the surcharge means for their property, not a generic warning.

If you own property above £2 million in London and want a clear view of where you stand, get in touch for a discreet, no-obligation conversation.