Finance
UK Announces New Tax on Expensive Homes From 2028
Published by Global Banking & Finance Review®
Posted on November 26, 2025
1 min readLast updated: January 20, 2026
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The UK will introduce a new tax on homes valued over £2 million from April 2028, with charges ranging from £2,500 to £7,500, adjusted for inflation.
UK to Implement New Tax on Homes Over £2 Million by 2028
LONDON (Reuters) -Britain announced a new annual tax on homes worth more than 2 million pounds ($2.63 million), expected to raise 0.4 billion in 2029-30, according to estimates from the country's budget watchdog published on Wednesday ahead of the finance minister's budget statement.
The new surcharge will come into force in April 2028.
The OBR said owners of homes valued at over 2 million by the Valuation Office, in 2026 prices, will be liable for a recurring annual charge which will be additional to existing local tax liability.
Under the changes, there will be four price local tax bands with the surcharge rising from 2,500 pounds for a home valued in the lowest 2 million to 2.5 million band, rising to 7,500 pounds for a property valued in the highest band of 5 million or more.
The values will be uprated in line with consumer price inflation every year, the document showed.
($1 = 0.7595 pounds)
(Reporting by David Milliken; writing by Suban Abdulla; editing by William James)
Key Takeaways
- •UK announces new tax on homes over £2 million.
- •Tax expected to raise £0.4 billion in 2029-30.
- •Surcharge starts in April 2028 with four tax bands.
- •Annual charges range from £2,500 to £7,500.
- •Values adjusted annually for inflation.
Frequently Asked Questions about UK announces new tax on expensive homes from 2028
1What is property valuation?
Property valuation is the process of determining the worth of a property, often conducted by a professional appraiser. It considers various factors, including location, size, condition, and market trends.
2What is consumer price inflation?
Consumer price inflation measures the rate at which the general level of prices for goods and services rises, leading to a decrease in purchasing power. It is often expressed as a percentage increase over time.
3What is a surcharge?
A surcharge is an additional charge or payment added to the standard cost of a service or product. In the context of taxes, it refers to an extra tax imposed on certain properties or income.