Government Considers Capital Gains Tax on High-Value Homes

Chancellor Rachel Reeves is considering a new property tax proposal under which properties valued at £1.5 million and above would be subject to Capital Gains Tax (CGT) on any increase in value. Higher-rate taxpayers would pay 24% of any gain, while basic-rate taxpayers would face an 18% levy.

The government intends this measure to help close the UK’s fiscal gap, though it may also have implications for the housing market and long-term homeowners.

Harps Garcha, Director at Slough-based Brooklyns Financial, warned that London and the South East would be hardest hit. She explained: “The Government’s plan will massively affect middle-class families who have sacrificed for years to build wealth through property. Many had planned to rely on this equity in retirement by downsizing. Instead, they now face double taxation — first through Stamp Duty and then on any capital gain. This policy punishes prudence and discourages financial independence."

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