Budget 2026 · Property

Budget 2026 and property: stamp duty, the mansion tax, landlords and first-time buyers

Published 28 October 2026, Budget day; updated the same evening. Every figure below is taken from the Budget 2026 document and the Treasury and HMRC papers published with it; paragraph numbers are given so you can check them. Worked examples are our own calculations and say so.

Did Budget 2026 change stamp duty?

No. We checked the Budget document and the Overview of Tax Legislation and Rates published with it: the residential Stamp Duty Land Tax rates are still listed as the rates "from 1 April 2025", and none of the Budget's measures changes a rate or threshold. If you are mid-purchase, nothing in the Budget changes what you will pay on completion in England or Northern Ireland. Wales has its own Land Transaction Tax and Scotland its LBTT, which the UK Budget does not set.

Work out your own figure with our stamp duty calculator, or add up every cost with the cost of buying a house calculator.

The stamp duty changes the Budget did make are narrow. Tenants no longer pay SDLT on rent under assured tenancies in England, backdated to 1 May 2026, and no longer have to file an SDLT return just because rent is payable (para 6.237). The other two, a group relief fix from 29 October 2026 and a relief for the Local Government Pension Scheme, affect companies and pension funds, not home buyers (paras 6.169, 6.236).

What is the High Value Council Tax Surcharge, and who pays it?

The surcharge, often called the mansion tax, was first announced at Budget 2025. Budget 2026 confirmed the design after consultation (para 6.234). It is a new yearly charge on owners of residential property in England worth £2 million or more, starting on 1 April 2028; the £2 million threshold set at Budget 2025 is unchanged. The Valuation Office will run a targeted valuation to find homes in scope and place each in one of four bands; councils will collect the charge alongside council tax and pass it to central government.

• Owners pay, not tenants. Council tax is mostly paid by occupiers; the surcharge is charged to the legal owner. The government estimates about 150,000 individuals and 15,000 businesses and organisations will pay it.
• Deferral. The government intends to let owners delay payment until the home changes hands if household income is £35,000 or less, savings are £16,000 or less, or a household member meets disability criteria. The interest rate on deferred amounts will be set in regulations.
• Empty homes. A 100% premium applies to homes that are substantially unfurnished and unoccupied for 12 months or more.
• Exempt or discounted. Student halls, care homes and hospices, and military barracks are exempt. Social housing, refuges, diplomatic homes, other armed forces housing and developer-owned new builds (until first sale or 12 months after the completion notice, whichever is sooner) get a discount of up to 100%. Farmhouses on working farms and qualifying charity property also get a discount.
• Valuation and appeals. The consultation proposed valuing homes as at 2026, revaluing every five years (next in 2033) and, in most cases, not rebanding a home for improvements alone until it is sold, split or merged, or the next revaluation. It also proposed a draft list of homes in scope in autumn 2027 and an initial 8 months to challenge a band (6 months for owners who become liable later). Owners can challenge their band and appeal to the Valuation Tribunal for England.

If you are buying near £2 million in England, budget for the surcharge as a running cost from April 2028 and, once the Valuation Office has banded homes in scope, ask the seller which band applies. Our free report shows what the property and its neighbours last sold for, which is a quick first read on how close to the line it sits.

Sources: tax information note; consultation and government response (response paras 4.7, 5.9 to 5.12, 6.12, 7.1).

How much more tax will landlords pay from April 2027?

Budget 2025 had already split property income from other income and set its tax rates 2 points above the main rates from April 2027. Budget 2026 adds 2 more points (paras 2.50 and 6.246). From 6 April 2027 the property basic rate is 24%, the higher rate 44% and the additional rate 49%, in England, Wales and Northern Ireland. The Treasury says the Scottish and Welsh governments can set their own property rates under their existing powers. The Treasury's costing says mortgage interest relief (the finance cost tax credit) stays tied to the property basic rate, so it rises to 24% too.

For a landlord with no mortgage the sums are simpler: on £10,000 of profit, a basic rate taxpayer pays £2,400 in 2027-28 instead of £2,000 now, and a higher rate taxpayer £4,400 instead of £4,000. The Treasury expects the change to raise £575 million in 2028-29 and allows for some landlords moving their properties into a company, though it expects few to (policy costings, page 74).

Other changes for landlords in this Budget:

• £65 register fee. The Renters' Rights "Register your rental property" service for private landlords in England charges £65 a year per property from 15 December 2026, with registration rolled out in phases. About 4.9 million properties are in scope, registration will be a legal requirement and councils can take enforcement action (policy costings, pages 107 to 108).
• HMRC will see more rental data. A consultation open until 20 January 2027 proposes standing duties on letting agents and tenancy deposit schemes to report landlords' rental income to HMRC, more often and faster than the current yearly notices (paras 2.35, 6.157). The same paper notes landlords with income over £20,000 join Making Tax Digital from April 2028.
• Making Tax Digital. People joining MTD for income tax in April 2027 will not get penalty points for late submission of their first four quarterly updates (para 6.152).
• Selling a rental home. You still have to report a UK residential property gain and pay the Capital Gains Tax within 60 days of completion. From 28 October 2026, if you miss that but report the sale on your Self Assessment return, late filing penalties stop building up from that point. Capital Gains Tax rates on property gains are unchanged at 18% and 24% (OOTLAR, Annex A).

What does the Budget do for first-time buyers?

Your First Home: 2.5% deposits on new builds

The new £4.7 billion Your First Home scheme lends first-time buyers in England 20% of the price as an equity loan (paras 5.5, 5.6 and 6.113). The Treasury's costing says the loans are for new-build homes. It expects to help about 70,000 households and support about 20,000 new homes.

Worked example (our calculation): on a £300,000 new build, assuming the local price cap allows it, the buyer puts down £7,500 (2.5%), the scheme lends £60,000 (20%) and the mortgage is £232,500. With a 5% deposit and no scheme the mortgage would be £285,000. At an illustrative 4.5% over 30 years that is about £1,178 a month instead of £1,444, roughly £266 less, while the equity loan is interest free. The loan still has to be repaid, so read the final terms before you sign.

Lifetime ISA: a smaller charge above £450,000, and a replacement from 2029

From 29 October 2026, if you use a Lifetime ISA to buy a first home that costs more than £450,000, the withdrawal charge is 20% instead of 25% (paras 5.9, 6.240). A 20% charge takes back exactly the 25% bonus, so you keep every pound you paid in. The 25% charge stays for other early withdrawals. HMRC says 87,250 people used a Lifetime ISA to buy a home in 2024-25, withdrawing £15,782 on average.

From April 2029 a First Time Buyer ISA replaces the Lifetime ISA for new savers (paras 5.8, 6.239). You can pay in up to £4,000 a year and get a 25% bonus worked out on the final balance, so interest and growth count, paid when you buy a first home worth up to £450,000 with a mortgage. The bonus is capped at £20,000 in total, which you reach at an £80,000 balance. There is no upper age limit, unlike the Lifetime ISA, which you must open before 40. Existing Lifetime ISAs carry on under today's rules; you cannot transfer one into the new ISA, but you can use both for the same purchase. Help to Buy ISA holders can move their whole balance into a First Time Buyer ISA, outside the yearly limit, between 6 April 2029 and 1 December 2030.

Saving a deposit in cash? The government decided not to reduce the cash ISA limit, so from April 2027 savers can still put up to £20,000 a year into a cash ISA (paras 2.52, 6.248; OOTLAR 2.5).

What changes for homeowners' bills?

• £100 Household Energy Payment. Households in council tax bands A to D in England get £100 from their council from January 2027: up to 20 million homes, about 80% of households in England. Councils also get £100 million to help households hit hard by energy bills, including some in higher bands (paras 3.5, 6.24).
• 0% VAT on household electricity in Great Britain, due to end on 31 March 2027, now runs until 30 June 2027. The Treasury expects it to take around £50 off the annual Ofgem price cap from April 2027 (para 3.4; OOTLAR 2.20).
• Gas standing charges. The government has asked Ofgem to abolish them on household bills, aiming for the end of 2027 or as soon as possible after (para 6.25).
• Energy-saving materials. The 0% VAT rate on installing materials such as solar panels, heat pumps and insulation in homes ends as planned, and the rate goes back to 5% from 1 April 2027. Heat batteries are added to the relief from the same date (para 6.215; OOTLAR 2.22). On £10,000 of work before VAT that is £500 more (our calculation). Which rate applies follows HMRC's tax point rules (when the work is done, invoiced and paid), not when you book, so if an installation falls around the end of March 2027, ask the installer in writing which rate will be on the invoice.
• Boiler Upgrade Scheme stays at £400 million in 2027-28, rising broadly with inflation after that (para 4.36).

Not sure which council tax band a home is in? GOV.UK's council tax band checkershows the band for any address in England and Wales. Our free report shows the council and its 2026-27 council tax level alongside the EPC rating, which drives most of a home's energy bill.

What did the Budget not change?

• Stamp duty rates and thresholds, including first-time buyer relief.
• The inheritance tax nil-rate band (£325,000) and residence nil-rate band (£175,000), listed at the same level for 2026-27 and 2027-28 (OOTLAR, Annex A).
• The £450,000 property price cap for the Lifetime ISA, which the new First Time Buyer ISA keeps.
• The £20,000 annual ISA allowance. The cash ISA limit also stays at £20,000: the government decided not to reduce it (paras 2.52, 6.248).
• Capital Gains Tax on property: 18% and 24%, with a £3,000 annual exempt amount, in 2026-27 and 2027-28 (OOTLAR, Annex A).
• The £2 million threshold for the High Value Council Tax Surcharge.
• Council tax bands. The Budget announces no council tax revaluation; the surcharge above sits on top of existing bills.