There are many unknowns when first planning your dream extension or self-build
project and no one likes to encounter unexpected costs at a late stage of the
process. CIL is often less talked about but can have significant financial
implications, and in some cases can impact the overall financial viability of a
Project.
This blog is focused on providing an overview of the following points:
- What is CIL?
- The implications CIL could have for you
- Steps you should follow to ensure you’re not caught out
- CIL appeals.
Infrastructure funded through this route includes things like roads, schools,
recreational and community facilities.
Whilst most local planning authorities have adopted CIL some authorities have not.
You should check on your local council website as to whether they are a ‘Charging
Authority’ and if they are, find out what the current chargeable rate is. Every
authority is different and can set what amount they charge depending on their
infrastructure requirements. Their adopted ‘CIL charging schedule’ will set out
exactly which types of new development are CIL liable.
CIL is a levy on certain types of development and is charged in £ per square
metre of new development that is over 100sq.m of gross internal floorspace. It
can also be charged on new dwellings even if they are less than 100sq.m.
Unlike other levies such as Section 106 legal agreements, CIL is non-negotiable.
The rate of CIL is index-linked in line with inflation so it is important you are
aware of the latest charging figures when you are first considering overall costs
associated with your development as the price will probably have increased since
CIL was first adopted.
Exemptions and Relief for CIL
There are several exemptions and relief that can be sought for CIL, including:
- Self-Build Exemption
- Residential Annex Exemption
- Residential Extension Exemption
- Charitable and/ or Social Housing Relief
- Exceptional Circumstances Relief
Three of the most common exemptions/reliefs are summarised briefly below:
Self-builds
The self-build exemption is commonly sought by those who have been granted
planning permission to build their own home. However, caution should be
exercised as there are several declarations that will need to be agreed to. For
example, the Applicant/s must own the property and commit to continuing to occupy the property as their principal residence for at least 3 years after the home
has been completed.
Residential Annexes and Extensions
To qualify for the annexe exemption, the annexe must be within the curtilage of the
main dwelling, and that main dwelling must be your principal residence.
Residential extensions under 100sq.m (Gross Internal Area), which are not part of
a development that creates a new dwelling, are already exempt from the levy
under the ‘minor development exemption’. However, if the extension is over
100sq.m then you can seek an extension exemption (again, as long as the
dwelling is your principal residence).
Benefiting from Existing Floorspace
If you are granted permission to change the use of an existing building that has
been in lawful use* for at least 6 continuous months in the past 3 years, then the
development should not be CIL liable as there is no net increase in floor space. You
should be aware that the Local Planning Authority may ask for evidence to confirm
the lawful use (for example utility bills, photographs, tenancy agreements etc.).
- ’ lawful use’ means a use that previously had planning permission granted.
Even if the development proposes a net increase in overall floorspace, you can
still take the benefit of existing floorspace to offset against the overall CIL
liability. Any use of existing floorspace should be carefully documented on the
‘Additional Information Form’ (normally submitted with the planning application).
Key Steps for CIL Regulations
The CIL regulations are complex and in complicated cases it may be advisable to
seek specialist advice. However, most cases are straightforward, and the
necessary forms can be dealt with directly with your Local Planning Authority’s
dedicated CIL Officer/Team.
It is critical that all necessary CIL forms are completed and acknowledged by your
Planning Authority prior to any works starting on site. Failure to do so can result
in a fine, or surcharge or you could even lose the exemption you are seeking (such
as the self-build exemption). It should also be noted that exemptions cannot be
claimed retrospectively.
The main steps to be aware of for CIL regulations are:
- Check whether your planning application should be accompanied by any CIL
Forms. Most Charging Authorities require at least ‘CIL Form 1’ (Additional
Information) to accompany the initial planning submission. Some also require ‘CIL
Form 2’ (Assumption of Liability).
If the site is to be sold at a later date then there is a form that can transfer liability
to another party/parties (CIL Form 3 and CIL Form 4).
- Once planning permission has been granted, the Council has a duty under
the CIL regulations to issue a ‘liability notice’ (if relevant) as soon as possible. If
you are keen to proceed with your development and believe that the scheme is
liable to pay CIL then you should contact the CIL Team to discuss why a liability
notice has not yet been issued.
- If you have received a Liability Notice then you should ensure the payment
instructions are followed and a Commencement Notice (CIL Form 6) is completed
prior to starting any work on site.
If you are seeking an exemption, then you should submit the necessary forms as
soon as possible in the process (ideally with the planning application submission)
but always prior to the commencement of works to ensure the Council acknowledges
your request and issue an updated liability notice recognising the exemption
the claim has been successful.
Some exemptions also require additional forms to be completed 6 months post
completion, providing additional evidence (including the self-build exemption).
CIL Appeals
It is possible to appeal against your CIL liability. There are timing restrictions that
limit the right to appeal and further information can be found on the Government’s
Website. If you disagree with a Liability Notice that you have been issued with, you must
firstly ask the Council for a ‘review’ of the chargeable amount within 28 days of
the liability notice.
If the Council does not respond within 14 days, or, they do respond but you still
disagree with the decision on the review your appeal must be submitted to the
Valuation Officer within 60 days of the liability notice.
Conclusion
Navigating the intricacies of the Community Infrastructure Levy (CIL) is crucial for anyone planning a significant building project. By understanding what CIL is, its potential financial implications, and the necessary steps to ensure compliance, you can avoid unexpected costs and delays. Exemptions and reliefs, such as those for self-builds or residential extensions, offer potential financial reprieve but require careful adherence to regulations.
Staying informed and proactive, particularly with form submissions and payment instructions, will help you manage CIL effectively. Always consult your Local Planning Authority and consider seeking specialist advice for complex cases to ensure your project remains viable and compliant.
Note: This blog does not constitute formal advice. It is intended to be an introduction to
the CIL process. Should you require tailored advice then it is always recommended that expert advice is sought.