The Labour Government's property tax raid could leave some homeowners facing death duties of up to £140,000, analysis shows. Chancellor Rachel Reeves has announced that, from April 2028, the Government plans to introduce a new High Value Council Tax Surcharge (HVCTS) on owners of residential property in England worth £2million or more.

Ms Reeves is expected to let some "asset-rich, cash-poor" owners defer paying the new surcharge of up to £7,500 per year on high-value properties. But delaying payments could put some homeowners at risk of having to pay huge tax bills.

Analysis by wealth management firm AJ Bells shows that a 65-year-old with a home valued at £2m who defers their £2,500 annual council tax surcharge for 15 years until dying aged 80 would end up with a tax bill of £46,692.

Homeowners with properties worth £5m or more would see this rises to £140,077, according to the analysis, which assumes a 2% inflation rate per year.

This bill would be in addition to any inheritance tax payable on the property and stamp duty applied when it was bought.

The Chancellor's move is intended to target more expensive homes to make the system fairer.

According to the Treasury, the typical family home in England currently pays more per year in council tax than a £10m property in London's Mayfair.

There will be four price bands with the new surcharge starting at £2,500 a year for properties worth more than £2m, rising to £7,500 for properties worth more than £5m.

The charge will sit on top of the usual council tax and will be applied to property owners, rather than tenants.

The Government estimates fewer than 1% of all UK properties will be subject to the additional tax - but it will raise more than £400m in 2029-30.

Ms Reeves' tax measure will primarily affect properties in London and south-east England, where 80% of all UK homes above £2m are located, according to property portal OnTheMarket.