Published: 28/11/2025 By Ben Wadey
After months of speculation, reversals, and policy updates, we finally have a clearer sense of where the Government is heading. This latest Budget includes a number of substantial changes affecting property owners, landlords, and individuals engaged in estate and wealth planning. As advisers, we believe it is vital to consider how these measures may affect your property interests, long-term plans and day-to-day cash flow.Ben Wadey, Chartered Accountant and Chief Financial Officer at Symonds & Sampson, has reviewed the Budget and its potential implications for our clients, highlighting the key points below.
1. New annual High Property Surcharge
- The government will introduce a high-value homes charge on all properties valued at over £2 million.
- The surcharge will take the form of an annual levy and is to be introduced from April 2028.
- The levy rates are set across four bands. Homes in the first band, £2 million to £2.5 million, would pay a starting surcharge of £2,500 per year. Properties in the final band worth £5 million or more would pay a yearly surcharge of £7,500.
- Assessments from the Valuation Office will determine the valuation and will be updated annually in line with inflation.
CFO Comments: “Introducing an annual charge on high-value homes is a significant shift in how property ownership is taxed. It may indicate a future move away from one-off transaction taxes, such as Stamp Duty Land Tax, towards higher ongoing ownership costs.
We’ve seen the market slow in recent months, partly because people feared the threshold could be much lower. Now that the Government has confirmed its plans, we should see confidence return to the property market for both buyers and sellers. Hopefully, this will help unlock transactions that have been on hold while everyone waited for clarity.”
2. Increase in Tax on Property Income, Dividends & Savings
- Individuals face an increase in tax on property income, dividend income and savings income by two percentage points across all bands from April 2027, as announced in the budget.
- For individuals with rental income, this means a higher ongoing tax bill, directly affecting rental yields and investment property returns.
CFO Comments: “With higher tax rates and stricter obligations introduced by the Renters’ Rights Act, landlords should take this opportunity to assess their property portfolios strategically. Ongoing reviews are increasingly important to sustain profitability and ensure continued compliance in an evolving regulatory environment. Clients might want to consider rent reviews to cover any increases in tax liabilities.”
3. Changes to Business Rates
- As part of the 2025 Budget, the Government has introduced a major reform of the business-rates system, to take effect from April 2026.
- Retail, Hospitality & Leisure (RHL) properties with rateable values under £500,000 will benefit from reduced multipliers.
- Properties with rateable values of £500,000 or more face a "high-value" multiplier.
CFO Comments: “For businesses in larger or high-value premises, this new banding could mean noticeably higher costs. That said, the reduced rates for smaller RHL properties will be a welcome break for many high-street operators and a positive signal for investment.”
4. Indirect impact on Estate Planning, Gifting and IHT
- Although the budget does not introduce any immediate changes to IHT or lifetime gifting rules, it reinforces the Government's policy direction towards greater taxation of property-based wealth. This makes future reforms, such as restrictions on reliefs, allowances, or gifting exemptions, more likely.
CFO Comments: “Given the Government’s clear move towards taxing wealth, not just income, the risk of future tightening of IHT, gifting allowances or reliefs has increased. Clients with substantial property-based wealth should revisit estate planning as soon as possible.”
Summary
Although this Budget brings higher taxes for some property owners, it also signals a period of clarity and opportunity.
Despite increased taxation on income and high-value properties, demand for quality homes across the South and wider UK remains strong, and the long-term fundamentals of the property market continue to be resilient.
Thoughtful planning and timely advice will remain key. With the right strategy, clients can navigate these changes confidently, invest wisely, protect their assets, and continue to build value in a sector that has historically shown remarkable endurance.
We believe that, with careful review and proactive adjustments, property owners can approach this new landscape with optimism and position themselves to benefit from emerging opportunities as the market adapts.
If you would like to discuss how the budget affects you and any steps you could take, please contact Ben or a member of our qualified staff.