Chargeable development under the Community Infrastructure Levy

Chargeable development is the term the Community Infrastructure Levy Regulations 2010 use for the development that actually attracts a levy charge. It is not the same as the development described on the application form. Regulation 6 defines what counts as development for levy purposes, the minor development exemption takes out new build under 100 square metres unless a dwelling is created, and the existing floorspace offset removes the gross internal area of qualifying buildings already on the site. What is left, net, is chargeable.

Three details decide most liabilities: the gross internal area measurement, whether the existing building passes the in-use test, and whether anyone served the right notice before work started.

What makes development chargeable

The levy applies to development that creates new build floorspace or new dwellings, in an area where a charging authority has adopted a charging schedule.

Regulation 6 captures anything done by way of, or for the purpose of, the creation of a new building or the enlargement of an existing one. A change of use with no new floorspace is normally outside it, which is why a conversion can be levy-free while the same building extended by a single storey is not.

Two exclusions do the most work in practice. Development with a gross internal area of new build below 100 square metres is exempt as minor development, unless it creates one or more dwellings, in which case the exemption falls away entirely. And buildings into which people do not normally go, or go only intermittently for the purpose of maintaining plant, are outside the charge.

Mezzanine floors inserted into an existing building are a recurring trap. Where the floorspace is created within an existing structure the position depends on whether planning permission was required for it, so check before assuming a mezzanine is free.

How the chargeable amount is calculated

The calculation is mechanical, and it is set out in regulation 40.

The chargeable amount is the rate from the adopted charging schedule, applied to the net chargeable area, indexed from the year the charging schedule took effect to the year permission was granted. The index is specified in the Regulations and published annually, so the figure that applies to your permission is not the figure that applied when the schedule was adopted.

Rates are set per square metre and usually vary by use and by geographic zone within the authority. Residential, retail and other uses can each carry a different rate on the same site, which means a mixed-use scheme is calculated use by use rather than as a single sum.

Two measurement points matter more than they should. Gross internal area is measured to the internal face of the external walls, following the recognised measuring practice, and it includes plant rooms, circulation, internal walls and stair openings. An area schedule prepared for a sales brochure will understate it. Prepare a separate levy area schedule, and keep the calculation on the same basis for the existing building as for the proposed one.

The existing floorspace offset and the lawful use condition

The offset is where money is won and lost.

The gross internal area of an existing building on the site can be deducted from the new floorspace, but only where the building is an in-use building. The test, in Schedule 1 to the Regulations, is that a part of the building has been in lawful use for a continuous period of at least six months within the three years ending on the day planning permission first permits the chargeable development.

Each element of that test is litigated. Lawful use means use that did not breach planning control, which brings the planning unit and its lawful use into play, and severance of a planning unit can change the answer. Continuous means without a break. Six months within three years is a short window and a long lookback, and a building empty since before that window gets no offset at all.

Both demolished and retained parts can be offset where they qualify. A building demolished before the application is submitted can still attract the offset if it passed the in-use test on the relevant day, which is why a demolition programmed to suit a construction sequence can cost a great deal of levy.

Evidence of in-use is the applicant's problem. Business rates records, utility bills, lease documents, payroll, delivery records and dated photographs are what collecting authorities accept. Assemble them before the building empties, not afterwards.

Development under a general consent and the notice required

Levy liability does not depend on a planning application. Development carried out under a general consent, which in practice means permitted development under the General Permitted Development Order, can be chargeable in the same way.

Where that applies, regulation 64 requires a notice of chargeable development to be submitted to the collecting authority before development begins. The authority then issues a liability notice as it would for a permission.

This catches conversions and prior approvals that create dwellings. An office to residential conversion that adds floorspace, a barn conversion with an extension, an upward extension under the relevant class: each can be chargeable, and none of them generates a planning permission that would prompt the authority to issue a notice automatically. Begin without the notice and the surcharges follow.

Liability notices, assumption of liability and demand notices

The procedural sequence is unforgiving and there are four documents in it.

1. The liability notice, issued by the collecting authority as soon as practicable after permission first permits the development, stating the chargeable amount and the payment terms.
2. The assumption of liability, submitted by whoever will pay. Without it, liability defaults to the landowner and the instalment policy may be lost.
3. The commencement notice, submitted before development begins and stating the intended start date. Omitting it triggers a surcharge calculated as a percentage of the chargeable amount subject to a cap, and the loss of any instalment policy, so the whole sum becomes payable immediately.
4. The demand notice, which sets out what is due and when.

Late payment attracts further surcharges and interest. The amounts and percentages are set by the Regulations and have been amended, so take them from the current text.

Appeals are not to the Planning Inspectorate. The chargeable amount is reviewed by the collecting authority and then appealed to the Valuation Office Agency, surcharges and other decisions go to the Secretary of State under their own regulations, and everything else is a matter for the courts. Which route applies is a question of the same kind as the one in section 288 challenge or judicial review.

An illustrative example on a conversion

The figures below are illustrative and chosen to show the mechanism.

A two-storey office building of 400 square metres gross internal area is converted to four flats, with a 90 square metre rear extension. The residential rate in the adopted schedule is used, indexed to the year of permission.

If the office was occupied under a lease until four months before permission, with continuous occupation for the preceding two years, it passes the in-use test. The 400 square metres offsets against the new residential floorspace, leaving the 90 square metre extension as the net chargeable area.

If the office has stood empty for four years, it fails the test. There is no offset, and the chargeable area is the full new residential gross internal area, extension included. The same building, the same scheme, and a liability several times larger.

The difference is a matter of dates and evidence rather than of design.

Reliefs and the sequence that preserves them

Reliefs and exemptions are available for self-build housing, residential annexes and extensions, social housing and charitable development. All of them share one feature: they must be claimed and granted before development begins, and a commencement notice must still be served.

The sequence that preserves relief runs: liability notice issued, assumption of liability submitted, relief claimed, relief granted in writing by the authority, commencement notice served, then work starts. Start before the grant and the relief is lost outright, with no discretion to restore it.

Self-build relief carries a clawback period during which the dwelling must remain the claimant's principal residence, and a disqualifying event within that period makes the full amount payable.

Social housing relief interacts with the affordable housing position set out in an Affordable Housing Statement, and the levy sits alongside rather than inside a viability assessment, because levy liability is a fixed cost input rather than a negotiable obligation.

Browse all 66 PlanScope report types to see which documents a scheme of this kind normally needs.

This is general guidance, not legal advice; check the position with your local planning authority or a qualified professional before relying on it. PlanScope provides AI-assisted draft reports for planning applications. Reports should be reviewed before submission. We do not guarantee planning approval.