A £7,500 annual charge just became £15,000 overnight, and nobody voted on it at the ballot box. On 28 October 2026, buried inside the Autumn Budget documents, the government published its response to the High Value Council Tax Surcharge consultation, confirming a 100% premium on the so-called "mansion tax" for homes left substantially unfurnished and empty for 12 months or more, as reported by Planning Geek on the same day.
For owners of £2 million-plus property in Notting Hill and Kensington, this is not a distant policy footnote. Kensington & Chelsea has one of the highest concentrations of £2m+ homes and long-term empty properties anywhere in England, making this borough one of the most exposed areas in the country to the new empty homes council tax surcharge £2 million Notting Hill owners will soon face. The surcharge itself starts in April 2028, subject to the Finance Bill 2026-27, but the groundwork, valuations, draft lists and challenge windows, begins far sooner.
Key Takeaways
- From April 2028, English homes valued at £2 million or more face a new annual surcharge, now doubled for properties substantially unfurnished and unoccupied for 12 months or longer.
- Doubled bands run from £5,000 (£2m,£2.5m) up to £15,000 (£5m+), a direct hit on the empty homes council tax surcharge £2 million Notting Hill market is known for.
- The Valuation Office Agency will assess properties using 2026 values, with a draft list expected autumn 2027 and owners notified of their band by next autumn.
- Legal owners, including long leaseholders, companies and trustees, are liable, with joint owners jointly and severally responsible.
- Independent RICS valuation evidence will be critical for challenging borderline bandings near the £2m, £2.5m, £3.5m and £5m thresholds.
What the Budget Actually Confirmed
The government's consultation response, published alongside the Autumn Budget on 28 October 2026, sets out a High Value Council Tax Surcharge applying to residential property in England valued at £2 million or more. The standard annual bands are:
| Value Band | Standard Surcharge | Empty-Home Surcharge (100% premium) |
|---|---|---|
| £2m,£2.5m | £2,500 | £5,000 |
| £2.5m,£3.5m | £3,500 | £7,000 |
| £3.5m,£5m | £5,000 | £10,000 |
| £5m+ | £7,500 | £15,000 |
The headline change in this announcement is the empty-homes premium: a flat 100% uplift for homes that are substantially unfurnished and unoccupied for at least 12 months. Crucially, the government has chosen to target underused homes regardless of the owner's residency status, this is not just an "overseas owner" tax. A British family with a Notting Hill townhouse undergoing a slow refurbishment could, in principle, fall into scope.
This surcharge sits entirely separate from existing council tax empty-homes premiums charged by local authorities, which continue to operate alongside it.
Why Kensington and Notting Hill Face Disproportionate Exposure
Few parts of England combine high property values with pockets of long-term vacancy the way Kensington & Chelsea does. Without citing a specific figure, it is fair to say the borough's stock of period townhouses, mews houses and stucco-fronted villas means a meaningful share of local homes will sit above the £2 million entry threshold, and some of those will also be empty or lightly used for extended periods, whether due to renovation projects, probate, overseas ownership patterns, or simply owners who maintain a London base they rarely occupy.
That combination, high value plus low occupancy, is precisely what this policy is designed to capture. For the empty homes council tax surcharge £2 million Notting Hill area, the financial stakes are higher than almost anywhere else in the country.
How Valuation Will Work, and Why It Matters
The Valuation Office Agency (VOA) will run a targeted valuation exercise based on 2026 values, not the outdated 1991 council tax bands used for ordinary council tax. This is a significant departure from how council tax has traditionally been assessed, and it introduces real uncertainty for owners near a threshold.
Key dates to track:
- Autumn 2027: draft list of affected homes expected.
- Autumn 2027 (following): owners informed of their individual band.
- April 2028: surcharge takes effect, subject to legislation.
A proposed eight-month window will apply for challenging bandings at launch, with six months for owners who become newly liable afterwards. Challenges are heard by the Valuation Tribunal.
"Where a property sits close to £2m, £2.5m, £3.5m or £5m, the difference between bands can be thousands of pounds a year, and doubled again if the home is empty."
This is where an independent RICS Red Book valuation becomes essential. The VOA's targeted exercise will not involve the same scrutiny as a full individual inspection, and owners near a threshold have a genuine opportunity to challenge an incorrect banding with professionally evidenced valuation reports reflecting true 2026 market value.
Who Is Liable
The surcharge falls on the legal owner, which includes:
- Freehold owners
- Long leaseholders (where the lease was originally granted for more than 21 years)
- Companies holding residential property
- Trustees
- Joint owners, liable jointly and severally, meaning each owner can be pursued for the full amount
HMRC estimates around 150,000 individual owners and 15,000 businesses or organisations will be affected nationally. These are estimates of owners, not a count of individual homes, so multiple owners of the same property will not inflate the figure.
What Counts as "Substantially Unfurnished and Unoccupied"?
This is the detail that will generate the most disputes, particularly in Notting Hill and Kensington, where many £2m+ homes undergo lengthy refurbishment before sale or re-occupation. The government has not yet published granular guidance on what qualifies, but owners in the following situations should pay close attention:
- Second homes under renovation: if stripped of furniture during a major works programme lasting close to or beyond 12 months, a property could be captured even though the owner intends to return.
- Probate properties: homes left empty while estates are settled.
- Investment properties between tenancies: particularly where refurbishment extends void periods.
- Properties awaiting sale: especially at the top end of the market, where marketing periods can run well beyond a year.
Owners should keep clear records, invoices, contractor schedules, utility usage, demonstrating genuine occupation efforts or the practical necessity of works, ahead of any future challenge.
Reliefs, Discounts and Exemptions
The policy includes several carve-outs:
- Deferral for main homes: available where household income is £35,000 or less, savings are £16,000 or less, or a household member meets disability criteria. Deferred amounts are generally repayable on change of ownership; the interest rate has not yet been set.
- Unsold new-builds: discounted until first sale or 12 months after a completion notice.
- Farmhouses: scope still being developed.
- Exemptions: purpose-built student halls, long-term care accommodation, qualifying military barracks.
- Up to 100% discounts: registered social housing, refuges, diplomats, certain military housing, and qualifying charities.
Few of these will apply to typical Notting Hill or Kensington private owners, which makes early planning and accurate valuation evidence even more important.
Preparing Before the Autumn 2027 Draft List
With roughly eighteen months before the draft list appears, owners have a practical window to act:
- Establish a robust current valuation reflecting true 2026 market value, ideally from a RICS chartered surveyor, well before the VOA's exercise concludes.
- Review occupancy status of any second home, inherited property or refurbishment project, and document the reasons for vacancy.
- Check leasehold structures, since long leaseholders may carry liability alongside or instead of the freeholder.
- Model the financial impact across both standard and doubled bands, particularly for properties hovering near £2m, £2.5m, £3.5m or £5m.
- Diarise the challenge windows, eight months at launch, six months for new entrants, so evidence is ready in advance, not assembled in a rush.
What This Means for You
If you own, or are considering buying, a property above £2 million in Notting Hill, Kensington or the wider Royal Borough, this surcharge should now factor into your long-term holding costs, particularly if the home is, or might become, unoccupied for extended stretches during works or sale preparation. The gap between bands is wide, and the empty-home premium doubles the stakes. An independent, Red Book-compliant valuation now gives you a documented, defensible position ahead of the VOA's draft list and the formal challenge window.
Frequently Asked Questions
Does this surcharge replace existing empty-homes council tax premiums?
No. Existing local authority empty-homes premiums remain a separate system and will continue to apply alongside the new High Value Council Tax Surcharge.
When will I find out which band my property falls into?
A draft list is expected in autumn 2027, with individual owners notified of their specific band by the following autumn.
Can I challenge my valuation band?
Yes, through the Valuation Tribunal. A proposed eight-month window applies at launch, with six months for owners who become newly liable later.
Does it matter if I live abroad or in the UK?
No. The government has confirmed the surcharge targets underused homes regardless of the owner's residency status.
What if my home is empty because it is being renovated?
Guidance on "substantially unfurnished and unoccupied" is still developing. Owners should keep detailed records of works and timelines to support any future challenge.
Who is legally responsible for paying it?
The legal owner, including long leaseholders, companies and trustees. Joint owners are jointly and severally liable.
Conclusion
Budget 2026 has turned a previously theoretical "mansion tax" into a concrete, dated policy with real financial consequences for high-value, underused property, and Kensington & Chelsea sits squarely in its path. The doubling of the surcharge for homes left empty 12 months transforms routine refurbishment delays or slow sales into a potentially expensive liability. With the draft valuation list due autumn 2027 and the surcharge itself landing April 2028, the sensible move is to get ahead of the process now: obtain an independent RICS valuation, review occupancy evidence, and understand exactly where your property sits relative to the £2m, £2.5m, £3.5m and £5m thresholds. Speak to a RICS chartered surveyor at Notting Hill Surveyors to assess your exposure and prepare the evidence you may need well before the Valuation Office Agency's draft list arrives.
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Estimate Your 2028 Surcharge Band
Under £2m (not liable)
£2m – £2.5m
£2.5m – £3.5m
£3.5m – £5m
£5m+
No
Yes
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