Chiswick homeowners expecting a Council Tax hit in the Budget

House in Bedford Park

Country expects a ‘Mansion Tax’ on properties in bands F, G and H

Two days before the Budget speculation is rife that Chancellor Rachel Reeves will revalue properties across Council Tax bands F, G and H and hit them with a ‘Mansion tax’ surcharge.

Many of the houses in Chiswick fall into those bands. A three-bedroom terraced house with one toilet and bathroom is likely to be in band F, while a four bedroom house with two bathrooms is likely to be band G and a six-bedroom listed house in Bedford Park with three bathrooms would be in band H.

Council Tax in Hounslow is currently £3,012 for a home in band F, £3,476 in band G and £4,171 in band H.

In Ealing the charges are similar, but slightly lower: £2,948 in band F, £3,401 in band G and £4,082 in band H.

Photograph by Anna Kunst – annakunstphotography.com

Terraced houses in Chiswick; Photograph Anna Kunst

Surcharge on properties over £2m expected to average £4,000

It is widely reported that hundreds of thousands of properties will be hit with the new surcharge.

In the run-up to the Budget, the Chancellor has said she has to make some difficult choices, but that any tax rises will target those with the “broadest shoulders”.

Two approaches are being talked about: a simply levy on properties valued worth over £2m, which would impose a one per cent annual charge (£10,000 on a home valued at £3m), and a more complex version which would remove the capital gains tax (CGT) exemption on main residences worth more than £1.5m.

The Financial Times reports that: ‘The annual surcharge on Council Tax bills for properties affected will be applied on a sliding scale depending on the value of a property above the £2m threshold, but is expected to average about £4,000 a year’.

Photograph by Anna Kunst – annakunstphotography.com

Riverside properties at Strand on the Green; Photograph Anna Kunst

Revaluation of the Council Tax bands

At the same time as introducing the Mansion Tax, reportedly the Chancellor will also introduce a revaluation of all the homes in the country that are currently in the three highest Council Tax bands.

Currently, Council Tax valuations are based on the value of homes, based on the price the property would have sold for on the open market on 1 April 1991 in England. It fails to take account of the huge increase in London property prices over the past 30 years.

The London boroughs with the most Band H homes are: Westminster, Kensington & Chelsea, Camden, Barnet, Richmond, Hammersmith and Fulham and Wandsworth, but Chiswick’s house prices have more in common with those areas than they do with most of LB Hounslow.

Kirstie Allsopp

Kirstie Allsopp, presenter of Channel 4’s Location, Location, Location, is among those who say the Council Tax system needs to be reformed.

She told Times Radio:

“We all know that Council Tax is unfair. It doesn’t work. It needs to be redone. I have no objection to re-examining Council Tax. But I think the problem about this proposal is it’s going to cost a lot of money to revalue those properties”.

Wealth management specialists Killik, who have an office in Chiswick, will be giving their assessment of the Budget and how it will affect people locally in a guest blog for The Chiswick Calendar after the Chancellor has revealed her plans on Wednesday.

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