CIL liability notices and who actually pays the levy
If nobody assumes liability for the Community Infrastructure Levy, it apportions to the owners of the land. The notice sequence, the deadlines and the exemptions that have to be claimed.
The Community Infrastructure Levy is owed by whoever assumed liability for it, and if nobody does, it lands on the owners of the land. That default is the answer to the cil liability notice who pays question, and it is the part of the regime that surprises landowners who thought the levy was the developer's problem. The Community Infrastructure Levy Regulations 2010 set out a sequence of notices, and each one does a different job.
Nothing in that sequence is optional, and most of the money lost to the levy is lost through missed paperwork rather than through the rate itself.
The notice sequence
Four documents matter, in this order.
- The liability notice, issued by the collecting authority after permission is granted. It states the chargeable amount, how it was calculated, and the payment procedure.
- An assumption of liability, submitted by someone who agrees to pay. This is a voluntary act using the authority's form.
- A commencement notice, submitted before development starts. This is the trigger for payment and it is where schemes go wrong.
- The demand notice, issued after the authority knows development has started. It names the person liable and the dates payment falls due.
The liability notice is not a bill. It is a statement of the charge attaching to the permission, and it is reissued if the chargeable amount changes, for example after a section 73 variation or an amendment to the scheme.
The commencement notice is the one to diary. Submitting it late, or not at all, can remove an instalment entitlement so the whole charge becomes payable immediately, cancel exemptions and relief, and expose the liable party to a surcharge. The regulations set out those consequences in detail, and the collecting authority has little discretion about applying them.
Why someone should assume liability
Assuming liability is voluntary, and the alternative is worse. Where no valid assumption is in place when development starts, liability apportions to the owners of the relevant land by area under the default provisions in the regulations.
That matters in three common situations.
| Situation | Who pays if nobody assumes liability |
|---|---|
| Developer builds on land it owns outright | The developer, as owner |
| Option or promotion agreement, landowner retains title | The landowner |
| Several freeholders across the red line | Each owner, apportioned by area of their interest |
| Permission implemented by a purchaser after sale | The owner at the time, which is the purchaser |
A landowner granting an option over a field has usually not budgeted for a levy charge on a scheme somebody else designed. The protection is contractual, by requiring the developer to assume liability and to serve the commencement notice, and by taking an indemnity. The planning regime will not sort it out for you.
Liability can be transferred using the authority's form, and withdrawn, within the windows the regulations allow. Both have to happen at the right time relative to the start of development, so treat them as pre-start tasks alongside the pre-commencement conditions.
The calculation, and how to challenge it
The chargeable amount is the charging schedule's rate per square metre, indexed, applied to the net additional floorspace, with deductions for existing buildings that qualify. Two things drive most disputes: whether an existing building counts for the deduction, and how the gross internal area has been measured.
The existing-building deduction generally requires a lawful use for a continuous period within a defined window before permission, measured in months rather than years. The precise test and the period are in the regulations, and this is the single most valuable thing to check on a conversion or a replacement-dwelling scheme, because a qualifying existing building can take a large charge down to nothing.
If the figure looks wrong, the route is a review by the collecting authority first, requested within the short deadline the regulations specify, which is 28 days from the liability notice. After that, appeals go to different bodies depending on the ground. The Valuation Office Agency deals with the chargeable amount and with apportionment between owners. An appointed person, administered through the Planning Inspectorate, deals with surcharges, deemed commencement and stop notices.
Miss the review deadline and you are usually arguing about discretion rather than entitlement. The authority can correct an error in a liability notice, and it does not have to.
Exemptions that have to be claimed
Self-build housing, residential annexes and extensions, social housing relief and charitable relief all exist in the regulations, and none of them applies automatically. Each is claimed on a form, has to be granted before development starts, and carries a clawback period during which a disqualifying event, such as selling a self-build dwelling, brings the charge back.
The commencement notice requirement bites hardest here. A self-builder who starts work without the exemption being granted, or without the commencement notice, can lose the exemption entirely, and the amounts involved on a single dwelling are not small. That outcome has been litigated more than once and the courts have generally held the applicant to the regulations.
An illustrative example
A developer acquires a half-hectare site with a derelict workshop, gets permission for eight houses, and sells the serviced plots. The chargeable amount is set by the liability notice at the schedule's residential rate on the net additional floorspace, with a deduction claimed for the workshop. The figures here are illustrative.
If the developer assumes liability and serves the commencement notice before the diggers arrive, the charge is payable in instalments by the developer under the authority's instalment policy. If the developer does neither and sells the plots, each plot purchaser can find themselves an owner of relevant land with an apportioned share of a charge they knew nothing about, and no instalment entitlement. The paperwork changes who pays and when, without changing the rate at all.
Where the levy sits in an appraisal
Levy liability is a cost line in the appraisal, and it is not negotiable in the way a planning obligation is. The charging schedule is fixed, so the levy is an input to viability rather than an output of it, which is why the order of work matters: establish the levy position before you agree affordable housing or other obligations.
Section 106 obligations and levy payments cannot be used to pay for the same infrastructure, so a council asking for both towards the same item should be asked which one it is. Submission format for a viability appraisal covers how to present the levy line, and highway works are the other cost that gets underestimated at this stage, which highway works costs in a development appraisal deals with.
Where the appraisal has to be tested by the authority, a Viability Assessment sets out the inputs, and the levy belongs in it as a fixed cost with the charging schedule and the indexation cited.
A practical checklist before work starts
- Read the liability notice the day it arrives and check the floorspace figures against your own schedule of areas
- Diarise the 28 day review deadline before you file the notice away
- Submit the assumption of liability, and confirm the authority has recorded it
- Claim any exemption or relief and get it granted in writing
- Serve the commencement notice before any material operation on site, including site clearance
- Tell your contractor that a start on site without the notice is a financial event, not a programme event
Enter your postcode on PlanScope to see which supporting documents a scheme on your site is likely to need.
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.
Frequently asked questions
Who pays the Community Infrastructure Levy if nobody assumes liability?
The owners of the relevant land, apportioned between them by the area of their interests under the default provisions in the Community Infrastructure Levy Regulations 2010. That can mean a landowner under an option agreement, or a plot purchaser who bought after permission was granted. Requiring the developer to assume liability and to serve the commencement notice is a contractual matter, not a planning one.
What happens if I forget the commencement notice?
The consequences are financial and largely automatic. An instalment entitlement can be lost so the whole charge falls due at once, exemptions and relief already granted can be cancelled, and a surcharge can be applied. Collecting authorities have limited discretion, and the courts have generally held applicants to the regulations, so serve it before any material operation on site.
Can I challenge the amount on a liability notice?
Yes. Ask the collecting authority for a review within 28 days of the notice being issued, setting out where you say the calculation is wrong. If the review does not resolve it, the chargeable amount and apportionment are appealable to the Valuation Office Agency, while surcharges, deemed commencement and stop notices go to an appointed person through the Planning Inspectorate.
Does the existing building on my site reduce the charge?
It can, substantially. The regulations allow the floorspace of an existing building to be deducted where it has been in lawful use for a continuous period within a defined window before permission. The test and the period are specific, so check them against your evidence of use early, because on conversions it often decides whether there is a charge at all.
Is the levy negotiable like a section 106 contribution?
No. The rate comes from the council's adopted charging schedule and is applied by formula with annual indexation, so it is a fixed cost input rather than something to trade. Obligations and levy receipts also cannot fund the same infrastructure item, so a request for both towards one project should be queried.
Sources and further reading
This article is general guidance about the planning system in England and, where stated, the rest of the UK. It is not legal or professional advice. Check your local planning authority’s validation requirements and take professional advice for your specific site.