CIL commencement notices and the surcharge for missing one

A CIL commencement notice is a one page form, and failing to submit it is one of the most expensive administrative errors in development. Regulation 67 of the Community Infrastructure Levy Regulations 2010 requires the notice to reach the collecting authority no later than the day before work starts on the chargeable development. Miss it and two things happen automatically: a surcharge is imposed, and any right to pay by instalments falls away, so the whole levy becomes payable at once.

Neither consequence depends on intent, on whether the authority was inconvenienced, or on whether anyone noticed at the time. The regulations operate mechanically, which is why this catches experienced developers as often as first-time ones.

What the notice does

The commencement notice tells the collecting authority the date the chargeable development will start. That date sets the clock for everything that follows: the issue of the demand notice, the payment dates under any instalment policy, and the point at which relief that depends on continued compliance becomes vulnerable.

It sits at the end of a short sequence. A liability notice is issued by the authority after permission is granted. Someone assumes liability using the prescribed form. Any exemption or relief is claimed and granted. Then the commencement notice is served, and only then does work begin.

Skipping straight to the site is the pattern that causes the damage. Contractors mobilise, an excavator arrives to strip the topsoil, and nobody has told the council.

Timing and who serves it

The notice must be received by the collecting authority before the day work starts. Not on the day. Serving it the morning the machines arrive is already late.

Anyone can serve it, and in practice it should be served by whoever has assumed liability, because that is the party the financial consequences land on. Where liability has not been assumed at all, the authority can apportion it to the landowners, which is a worse outcome than the one you were trying to avoid.

Two details worth building into the pre-start checklist:

• Get a written acknowledgement of receipt, and keep it with the decision notice
• Serve a revised notice if the start date moves, because a notice stating a date that passes without work beginning is not evidence of anything

Where a development is phased and the permission properly identifies the phases, each phase is a separate chargeable development with its own notice. Phasing is one of the few areas where the regulations reward careful drafting at application stage, and it interacts with the payment timing covered in the note on CIL instalment policies and development cash flow.

The surcharge for starting without one

The surcharge for failing to submit a commencement notice is 20 per cent of the chargeable amount or £2,500, whichever is the lower. On any scheme with a levy liability above £12,500 the surcharge is therefore £2,500, and on smaller schemes it scales down.

That is not the whole cost. Separate surcharges apply for failing to assume liability before commencement and for other procedural failures, and further surcharges and interest apply once payment itself is late. Interest runs at a rate above the Bank of England base rate, and additional percentage surcharges bite at 30 days, six months and twelve months overdue.

The unwelcome arithmetic is that the surcharges are cumulative. A scheme that started without a commencement notice, where nobody had assumed liability, and where payment then ran late, can end up carrying three separate additions on top of the levy itself.

Losing instalment rights

This is usually the bigger number. Most charging authorities operate an instalment policy allowing payment in tranches over a period after commencement, and those policies are conditional on procedural compliance.

Where a commencement notice is not served, the instalment policy ceases to apply and the full amount becomes payable in a single sum, typically within 60 days of the deemed commencement date. On a major scheme that can mean a seven figure payment arriving in the middle of a groundworks programme, against a cash flow model that assumed payment spread over two years.

The authority also determines a deemed commencement date where none has been notified, based on the evidence available to it, which may be earlier than the date you would have chosen.

There is no discretion to reinstate the instalments. A collecting authority that sympathises with you still cannot restore a right the regulations have removed, which is worth remembering before spending time asking.

What counts as a material start

Commencement of the chargeable development is judged by reference to the material operations in section 56(4) of the Town and Country Planning Act 1990. Those include construction work in the course of erecting a building, demolition, digging a trench for foundations, laying an underground main or pipe to the foundations, and constructing a road.

Site activities that developers do not think of as starting work frequently qualify. Demolition is a material operation. So is digging a foundation trench for a small part of the building, and so is laying a drainage connection intended to serve the foundations.

Activities usually outside the definition include site investigation boreholes, fencing the site, erecting a site hut on made ground, and vegetation clearance that involves no groundworks. The line is not always obvious, and where a programme depends on it the safe course is to serve the commencement notice before any activity at all. It costs nothing to serve it early, and the date can be revised.

Correcting a missed notice

If you discover the notice was never served, act the same day. Serve one immediately, stating the actual date work began, and write to the collecting authority explaining what happened.

Voluntary disclosure does not remove the surcharge, and it improves everything else. It gives the authority a date to work from rather than a date to infer, it avoids an argument about deemed commencement, and it puts you in a better position on any review of the surcharge. Authorities have some discretion in how they exercise their enforcement powers, including CIL stop notices, and a developer who reported the error is treated differently from one who was found out.

Also check what else the omission has affected. Where an exemption or relief was in place, the consequences of a missed notice differ by relief type and have been amended since the regulations were made, so take the current position from the regulations and the authority rather than from an older summary.

Requesting a review and appealing

The regulations provide a route to challenge a surcharge. The first step is a request for review by the collecting authority, which has to be made within a short period, measured in days rather than weeks, of the surcharge being imposed.

If the review does not resolve it, an appeal lies to a person appointed by the Secretary of State, with the Planning Inspectorate administering appeals about surcharges and about a deemed commencement date. Appeals about the chargeable amount itself follow a different route to the Valuation Office Agency.

Grounds that succeed are narrow. A surcharge can be challenged where the authority made a factual error, where the notice was in fact served, or where the procedural step complained of did not apply. An appeal on the basis that the consequence is harsh will not succeed, because the regulations leave no room for that argument.

Three habits prevent all of this. Put the commencement notice on the pre-start checklist alongside the building control notice and the party wall notices. Keep the acknowledgements. And treat levy liability as a fixed cost with fixed dates rather than something to be negotiated, which is the practical distinction between the levy and the obligations discussed in the note on section 278 works or a section 106 contribution.

Where the levy materially affects scheme economics, the evidence sits in a Viability Assessment, and the report types that support a major application are listed in the planning report index.

This is general guidance, not legal advice, and levy procedure changes. Check the current regulations and your collecting authority's instalment policy, or take advice from 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.