Property taxes

Property tax changes confirmed in the Autumn Budget 2025

While the pre-Budget rumours were wide-ranging, the Chancellor ultimately concentrated her property tax reforms on measures targeting high-value properties and landlords. Key outcomes include:

• High-value council tax surcharge (‘Mansion Tax’) - A new annual surcharge for properties valued over £2 million, taking effect from April 2028. Four valuation bands will apply, and the measure will mainly affect high-value homes, which are typically concentrated in London and the South East.
• Increased income tax rates on property income - From April 2027, rental income will be taxed at rates 2 percentage points higher across all bands. This continues the trend of tightening the tax treatment of personally-held rental portfolios.
• Revaluation of high-value property for council tax purposes - A national revaluation has been commissioned for around 2.4 million higher-value homes. This underpins the new surcharge and indicates potential longer-term reform of the council tax.
• Increase in Tax Rates on dividends – From April 2026, the tax rate on dividends is to increase by 2% on both the basic (10.75%) and higher rate (35.75%) tax bands. The additional rate of tax on dividends remains at 39.35.

Despite heavy speculation, the Chancellor did not introduce National Insurance on rental profit, changes to SDLT, restrictions on main residence CGT relief, or a surcharge on standard residential CGT rates. These remain areas to watch, but no action is required at this stage.

Spring Statement 2026: No further tax changes

The Spring Statement confirmed that the government will move to one major fiscal event per year, and no new property tax measures were added. This gives clients and introducers a welcome period of stability for planning.

What clients should be doing now

Given the confirmed Autumn 2025 measures and the run-up to April 2026 changes, we believe advisors should ensure clients are focusing on:

Ownership structure review

Reassess whether to hold properties personally or via a company. With increasing tax on rental income and ongoing reforms, structure choice now has a bigger long-term impact on net returns.

Our guide on purchasing property gives a high-level overview of the advantages and disadvantages of owning a property in your own name or using a corporate structure, whilst considering succession planning to integrate.

Making Tax Digital (MTD) preparation

MTD begins for landlords with property income over:

• £50,000 from April 2026
• £30,000 from April 2027
• £20,000 from April 2028

Quarterly digital reporting obligations will be a significant shift. Clients should prepare systems and processes now.

Further information for landlords can be found in our Making Tax Digital for Landlords guide, and our Making Tax Digital homepage will be updated as and when further announcements are published.

Stamp Duty Land Tax (SDLT)

SDLT remains one of the highest upfront costs when acquiring property.

There are valuable exemptions and reliefs available to reduce SDLT exposure.

A misunderstanding of how a property is classified, residential vs mixed-use, can lead to clients overpaying tens of thousands of pounds. Our case study illustrates the tax savings that may be available.

Succession & IHT planning – big changes from 6 April 2026

Changes to Agricultural and Business Property Reliefs in April 2026 introduce a £2.5 million cap (increased from the originally announced £1 million cap) before relief falls from 100% to 50%.

For many property-holding families, lifetime gifting may now produce better outcomes than passing assets at death.

We have a one-hour on-demand webinar: Inheritance Tax and Succession Planning in 2025. There is also a short article here: Protect your family business for the next generation.

Family Investment Companies (FICs)

FICs remain a valuable vehicle for clients looking to manage rental income tax-efficiently and support long-term succession planning.

Our article on Family Investment Companies explains this can be helpful for income taxes and also IHT.

How can we help

Please get in touch with your usual Crowe contact if you want to discuss any of these topics further.