Last updated: 16 October 2026
Does the UK have a wealth tax?
No. The UK does not have an annual tax on a person’s total wealth. In 2025 the Chancellor faced calls to introduce one, with polls showing strong public support for higher taxes on the very wealthy and campaigners proposing a 2% charge on assets over £10 million. The government chose not to bring in a wealth tax. Instead, it has raised taxes on income from assets and on property in other ways.
How wealth is already taxed
| Tax | What it applies to | 2026/27 position |
| Inheritance tax | Estates and some lifetime gifts | 40% above £325,000 nil rate band, frozen to 2031; pensions included from April 2027 |
| Capital gains tax | Gains on assets | 18% and 24%; £3,000 annual exemption |
| Dividend tax | Company dividends | 10.75%, 35.75% and 39.35%; £500 allowance |
| Stamp Duty Land Tax | Property purchases | Up to 12%, plus 5% surcharge on additional homes |
| Council tax | Homes | Planned surcharge on homes in England valued at £2 million or more from April 2028 |
The high value council tax surcharge
The November 2025 Budget announced a High Value Council Tax Surcharge on homes in England valued at £2 million or more, due to start in April 2028. The government’s consultation proposes annual charges of £2,500 (£2m to £2.5m), £3,500 (£2.5m to £3.5m), £5,000 (£3.5m to £5m) and £7,500 (over £5m), paid by owners and rising with inflation from 2029/30. It still needs legislation in a future Finance Bill, so treat it as a plan rather than law.
Other changes affecting wealthier households
- Savings and property income tax rates are due to rise by 2 percentage points from April 2027.
- Agricultural and Business Property Relief at 100% is capped at £2.5 million from April 2026, with 50% relief above that.
- Unused pension funds will count for inheritance tax from April 2027.
- The non-dom regime was replaced with a residence-based system from April 2025.
- The personal allowance and higher rate threshold are frozen until April 2031.
Example
Mark and Sue own a £2.4 million home, £600,000 of shares and £400,000 in pensions. There is no wealth tax on these assets. But from April 2027 their pensions may count for inheritance tax, from April 2028 they may pay the council tax surcharge, and their dividends are taxed at up to 35.75%. Planning now, through gifts, pension drawdown choices and use of allowances, can reduce the overall burden.
Planning ideas
- Use ISA allowances of £20,000 each a year.
2. Make lifetime gifts early and use the annual £3,000 exemption.
3. Review wills to make the most of the residence nil rate band.
4. Spread assets between spouses to use two sets of allowances.
5. Consider how pensions will be treated for inheritance tax.
Why a wealth tax is hard to introduce
Countries that have tried annual wealth taxes found them costly to run, hard to value assets for, and prone to people moving assets or themselves abroad. That is one reason the UK has preferred to tax income, gains, transfers and property instead.
Frequently asked questions
Could a wealth tax still be introduced?
Any future government could propose one, but there are no current plans.
Does the council tax surcharge apply in Scotland and Wales?
The announced surcharge is for England.
Is my main home subject to CGT?
Not usually, thanks to Private Residence Relief.
Are wealthy people leaving the UK?
Some have moved, mainly linked to the non-dom changes, though figures vary.
Related: non-doms leaving the UK, IHT changes for pensions and gifting money to reduce IHT.
Talk to Accotax
Want this handled for you? Our team at Accotax can help with tax planning for individuals and families. See our small business accountants service, or contact us for a free, no-obligation quote.
This page is general guidance based on HMRC rules for the 2026/27 tax year, checked against gov.uk on 16 October 2026. It is not personal advice, so speak to an accountant about your own situation.
