Personal

Starting in 2028-29, the government will introduce a High Value Council Tax Surcharge (HVCTS) for residential properties in England valued at £2 million or more. This surcharge will be collected by local authorities, but the revenue will go to central government.

High Value Council Tax Surcharge Charging Structure

Property Value	Surcharge
£2 million – £2.5 million	£2,500
£2.5 million – £3.5 million	£3,500
£3.5 million – £5 million	£5,000
Over £5 million	£7,500

The surcharge amounts will be based on the value of the residential property in 2026. The surcharge will increase as the property value rises, up to a maximum charge of £7,500 for properties valued over £5 million.

According to HM Treasury figures, the surcharge will apply to fewer than 1% of properties in England. Homeowners, not tenants, will be liable for the surcharge, which will be in addition to their existing Council Tax. Social housing will be excluded.

Properties above the £2 million threshold will be reassessed every five years by the Valuation Office. The surcharge rates will increase annually in line with CPI inflation starting in 2029-30.

This new charge is expected to raise around £430 million annually for local government services. Local authorities will be compensated for the additional costs of administering the surcharge. A public consultation on further details, including reliefs and exemptions, will take place next year.

HMRC has confirmed that parents of new-borns will still be able to claim Child Benefit despite the outbreak of Coronavirus. The weekly rates of child benefit for the only or eldest child in a family is currently £21.05 and the weekly rate for all other children is £13.95. The payment whilst relatively small could be a useful benefit for many new parents facing an uncertain future. Child Benefit claims can be backdated by up to 3 months.

This announcement by HMRC is to be welcomed. Usually, a claim cannot be made until you have registered the birth of your child and have a birth or adoption certificate. This is currently difficult as General Register Offices are operating with reduced capacity.

HMRC has said that to claim, first-time parents will need to fill in the Child Benefit Claim form – CH2 – which can be found online. The completed form must then be sent to the Child Benefit Office. If the birth has not been registered a note of this should be included on the claim form.

HMRC is also reminding new parents affected by the High Income Child Benefit Charge of the importance of claiming Child Benefit, even if they opt out of receiving the money itself.

The High Income Child Benefit charge applies to higher rate taxpayers whose income exceeds £50,000 in a tax year and who are in receipt of child benefit. The charge either reduces or removes the financial benefit of receiving child benefit. Where both partners have an income that exceeds £50,000, the charge will apply only to the partner with the highest income. For taxpayers with income above £60,000, the amount of the charge will equal the amount of child benefit received.