CIL liability thresholds and the exemptions
Development under 100 square metres escapes the Community Infrastructure Levy unless it creates a dwelling. Here is how liability is calculated, offset and relieved.
The cil threshold 100 square metres rule catches people out because it does not apply to houses. Under the Community Infrastructure Levy Regulations 2010, development creating less than 100 m² of new gross internal floorspace is exempt as minor development, but only where it does not create a dwelling. One new dwelling of 62 m² is liable in full. A 96 m² extension to an office is not liable at all, and neither is a 60 m² extension to a house.
That single distinction explains most of the surprised phone calls that reach collecting authority CIL teams.
When liability arises
Liability attaches to the grant of planning permission for chargeable development in an area with an adopted charging schedule, and it becomes payable when development begins.
Three conditions have to line up. The local planning authority, or in London the Mayor as well, must have adopted a charging schedule. The development must create new floorspace of a type the schedule charges. And no exemption or relief must apply.
The charge is calculated from the chargeable floorspace, the rate in the schedule for that use and zone, and the index figure for the year permission first permits development. Rates are index-linked annually, so a scheme permitted in one year and revised in another can carry a different figure. Always check the authority's current schedule and its published index rather than a rate quoted in an old report.
The floorspace threshold and why dwellings are different
Regulation 42 exempts development where the gross internal area of new build is less than 100 m², provided it does not comprise one or more dwellings.
Read the two limbs separately.
| Proposal | Under 100 m² of new floorspace | Creates a dwelling | Liable |
|---|---|---|---|
| Rear extension to a house, 45 m² | Yes | No | No |
| New one-bed house, 62 m² | Yes | Yes | Yes |
| Office extension, 96 m² | Yes | No | No |
| Two flats over a shop, 140 m² total | No | Yes | Yes |
| Annex within the curtilage, 55 m² | Yes | Depends on whether it is a separate dwelling | Claim the annex exemption |
Gross internal area is measured to the internal face of the external walls, and it includes everything inside that envelope: circulation, plant, stores and integral garages. Mezzanines count. Basements count. The area figure on a CIL form is not the area on a sales brochure, and the authority will measure it from your drawings.
Existing floorspace offsets
Demolishing or converting an existing building can reduce the chargeable amount, but only if the building qualifies as in use.
The test is that the building must have been in lawful use for at least six continuous months within the three years ending on the day planning permission first permits development. Evidence that satisfies collecting authorities includes business rates records, council tax records, utility bills showing consumption rather than standing charges, tenancy agreements and dated photographs.
Long-term empty buildings routinely fail this test. A barn unused for a decade brings no offset, so a conversion that feels like recycling an existing structure is charged as though the floorspace were new. That outcome surprises rural clients more than any other feature of the levy.
Put the evidence in with the application rather than waiting to be asked. Once the liability notice has been issued, you are arguing backwards.
There is a related point about retained floorspace. Where part of a building is kept and part demolished, only the qualifying retained or demolished area counts against the new build, and the calculation is done use by use rather than in total. On a mixed scheme this is worth checking line by line, because an error here moves the charge by more than any relief will.
Exemptions and reliefs worth knowing
Several reliefs exist, each with its own form and its own timing rule, and all of them must be claimed and granted before development begins.
- Self-build exemption for a whole new dwelling you will occupy as your main residence, with a three-year clawback period.
- Residential annex and residential extension exemptions, for works to your own home.
- Social housing relief, mandatory for qualifying tenures and discretionary where the authority has adopted the wider version.
- Charitable relief, where the owner is a charity and the development will be used for charitable purposes.
- Exceptional circumstances relief, only where the authority has resolved to make it available, which most have not.
The detailed sequence for the self-build route, including the two-part claim form and the six-month evidence deadline, is set out in the guide to the self-build exemption forms and deadlines.
Forms, notices and the surcharges behind them
The administrative chain is short and unforgiving.
- Someone assumes liability in writing before development begins.
- Any relief or exemption is claimed and granted before development begins.
- A commencement notice is served on the collecting authority before the first act of development.
- The authority issues a demand notice, and payment follows its instalments policy.
Miss step one and a surcharge applies. Miss step three and a further surcharge applies, calculated as a percentage of the chargeable amount subject to a cap in the regulations. Where no instalments policy exists, the full amount falls due shortly after the development begins, which for a self-builder can mean a five-figure payment at the worst point in the cash flow.
Interest runs on late payment, and unpaid levy becomes a local land charge. It will be found by a buyer's solicitor, and it will be found at the least convenient moment.
If a demand notice arrives and the figure looks wrong, act quickly. The regulations provide review and appeal routes covering the calculation of the chargeable amount, the apportionment of liability and the surcharges, and each runs to a short deadline measured in days rather than weeks. Missing those dates leaves negotiation as the only route, and collecting authorities have limited discretion to reduce a charge that has been correctly calculated.
Practical steps before you apply
Do this work before submission, not after the decision notice arrives.
Find the charging schedule and the current index figure on the authority's website, and note the date it was adopted. Calculate the likely charge yourself from the proposed floorspace. Check whether any existing building meets the in-use test and gather the evidence now. Identify which relief you will claim and download the form. Then diarise the two before-you-start deadlines.
Where a scheme is being split across plots or phases, the arithmetic changes, and the note on two dwellings on one plot covers what else shifts at that point. For the documents the application itself will need, a Planning Statement is normally the starting point.
This is general guidance, not legal advice. Check the position with your local planning authority or a qualified professional before relying on it.
Enter your postcode on PlanScope to see which reports your scheme is likely to need alongside the levy forms.
PlanScope provides AI-assisted draft reports for planning applications. Reports should be reviewed before submission. We do not guarantee planning approval.
Frequently asked questions
Is a small new house exempt from CIL?
No. The minor development exemption covers new build of less than 100 square metres gross internal area, but only where it does not create one or more dwellings. A 62 square metre house is chargeable in full. The exemption does apply to extensions and to non-residential floorspace below the threshold.
How is gross internal area measured for the levy?
To the internal face of the external walls, including circulation, plant rooms, stores, integral garages, mezzanines and basements. It is not the area quoted in a sales brochure. Collecting authorities measure it from the submitted drawings, so use the same basis in the forms and expect the figure to be checked.
Can I offset the floorspace of a building I am demolishing?
Only if it qualifies as in use. The building must have been in lawful use for at least six continuous months within the three years ending on the day permission first permits development. Business rates records, council tax records, utility consumption, tenancy agreements and dated photographs are the evidence authorities accept.
Do levy rates change each year?
Rates in an adopted charging schedule are index-linked, so the figure applied depends on the year in which permission first permits the development. Always take the rate and the index figure from the authority's current published schedule rather than from an older appraisal, and re-check it if the scheme is revised.
What happens if I start work without serving notice?
A surcharge applies, calculated as a percentage of the chargeable amount subject to a cap set in the regulations, and any instalments policy can be lost so the full sum falls due. Interest runs on late payment and unpaid levy becomes a local land charge that a buyer's solicitor will find.
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.