Mayoral levy bands and how they apply to a London scheme

The Mayoral Community Infrastructure Levy is charged across every London borough, on top of whatever the borough itself charges, and it is collected by the borough rather than by City Hall. The mayoral community infrastructure levy bands group the boroughs into three tiers with different rates per square metre, with separate higher rates for office, retail and hotel development in central London and the Isle of Dogs. The rates are indexed annually, so take the current figures from the Mayor's published charging schedule rather than from a feasibility study written last year.

Two levies, one payment process, and a set of deadlines that can cost you an exemption if you miss them.

Where the Mayoral levy comes from and who collects it

The levy operates under the Community Infrastructure Levy Regulations 2010. The Mayor of London is the charging authority for the mayoral levy, and the London boroughs and the City of London act as collecting authorities.

The practical consequence is that every form, notice and payment goes through the borough's CIL team, and the borough applies its own instalment policy to its own levy while the Mayor's instalment policy applies to the mayoral charge. One development, two schedules of payment dates.

The mayoral levy was introduced to contribute to Crossrail, now the Elizabeth line, and the current schedule replaced the original one from 1 April 2019. Where a scheme has a long planning history, check which schedule applies, because the answer depends on the date permission was granted rather than on when the development starts.

The borough levy is entirely separate. There is no netting off and no cap on the combined total, so budget both.

How the banding works across the boroughs

Boroughs are allocated to one of three bands, reflecting broad development value, with a rate per square metre of chargeable floorspace for most development in each band.

Central London and the Isle of Dogs are treated differently. Office, retail and hotel development in those areas attracts separate and considerably higher rates, defined by reference to a mapped area rather than by borough boundary, so a site on the edge of the designated area needs checking against the map rather than assumed.

Everything is indexed. The Regulations require annual indexation of levy rates, and the Mayor publishes the indexed figures, so the rate that applies is the one in force when the liability arises rather than the rate printed in the original schedule.

Which uses are chargeable and which are not

The levy applies to buildings into which people normally go, measured as gross internal area of new build floorspace. Structures such as pylons and plant enclosures that people do not normally enter are outside it.

The deduction that matters most is for existing floorspace. Where a building to be demolished or converted has been in lawful use for a continuous period of at least six months within the three years before permission first permits development, its floorspace can be deducted from the chargeable amount. The evidence for that lawful use has to be assembled before the calculation, not after, and on a long-vacant building it is often the single largest variable in the figure.

Changes of use with no new floorspace commonly produce a nil charge for that reason. A conversion of an occupied office to flats with no extension can be chargeable at zero on the mayoral levy while still attracting a borough charge on any new floorspace, so run both calculations rather than assuming symmetry.

Mezzanines inserted into an existing building, and floorspace within the building envelope that was not previously counted, need care. Measure the gross internal area consistently and show the measurement on a plan.

Relief, exemptions and the self-build position

Four reliefs and exemptions come up on London schemes.

Social housing relief is mandatory for qualifying affordable housing, with discretionary relief available for some other tenures where the charging authority has adopted it. Charitable relief applies where the owner is a charity and the development will be used for charitable purposes. The self-build exemption applies to a dwelling built by or commissioned by an individual for their own occupation. And there is an exemption for residential annexes and for extensions below the floorspace threshold in the Regulations.

The procedure is unforgiving, and this is the part that costs people money.

1. Assume liability on the prescribed form before development starts.
2. Claim the relief or exemption, and wait for the collecting authority to grant it in writing.
3. Submit a commencement notice before any material operation.
4. Keep the acknowledgements.

Starting work before a claim has been determined loses the relief. Failing to submit a commencement notice can also lose it, and attracts a surcharge. On self-build there is a further requirement to submit evidence after completion and a clawback period during which the dwelling must remain in the owner's occupation.

None of these deadlines is discretionary, and collecting authorities have limited power to forgive a missed one.

How it sits alongside a borough charging schedule

Both levies are payable, and neither reduces the other. The combined figure per square metre in some boroughs is the largest single planning cost on a mid-sized residential scheme after affordable housing.

Section 106 obligations sit on top again, although the Regulations restrict the use of planning obligations for infrastructure that the levy is intended to fund. Highway works under section 278 are separate once more, and the division between those mechanisms is worth getting right at heads of terms stage.

Where viability is argued, the levy is a fixed cost input rather than a negotiable one, because there is no mechanism to reduce a levy liability on viability grounds except discretionary relief where the authority has adopted it. That asymmetry is one reason affordable housing takes the strain in a constrained appraisal, and a Viability Assessment has to treat the levy as a fixed input and say so.

Site capacity decisions therefore have a direct levy consequence, since the charge follows floorspace. The design-led approach to optimising capacity is covered in optimising site capacity through a design-led approach.

Liability notices, assumption of liability and timing

The sequence runs as follows, and each step has a form.

The collecting authority issues a liability notice after permission is granted, setting out the chargeable amount for both levies. Someone must assume liability, which is a positive act and not automatic. Before any material operation, a commencement notice is submitted. The authority then issues a demand notice with the payment dates derived from the instalment policy.

Failure to assume liability or to serve a commencement notice attracts surcharges, and late payment attracts interest. Persistent non-payment can lead to a stop notice, which halts the development.

Two practical points. Assumption of liability can be transferred, which matters where a site is sold with permission, and the transfer has to be done properly before commencement. And a section 73 permission generates a fresh calculation, so varying a condition on a consented scheme can change the levy position, sometimes to the applicant's advantage and sometimes not.

The Infrastructure Levy provided for in the Levelling-up and Regeneration Act 2023 has not replaced this regime. As at October 2026 the Community Infrastructure Levy remains the operative mechanism in London, and the position should be verified before advising on a long-programme scheme.

Budgeting the figure before you submit

Work the number out at feasibility stage, not after permission.

A workable method runs in six steps.

1. Measure the proposed gross internal area by use, and show it on a plan.
2. Measure the existing floorspace and assemble the evidence of six months' lawful use within the previous three years.
3. Identify the band, and check the map to see whether the central area rates apply.
4. Apply the current indexed rates for the mayoral and the borough levy separately.
5. Deduct only relief you are confident of claiming and of claiming in time.
6. Model the cash flow against both instalment policies from the assumed commencement date.

Then stress-test it. Indexation moves the figure each year, a delay to commencement can move you into a higher indexed rate, and losing the existing floorspace deduction because the building has been empty too long can change the total materially.

Where the site sits in an area with its own policy framework, the levy interacts with other obligations, and an allocation can change both, as explained in what a London allocation changes in an opportunity area. Office to residential schemes have their own constraints to check first, set out in Article 4 directions and London office to residential conversion.

Record the calculation in the submission so the collecting authority can follow it. A clear statement of areas, deductions and rates reduces the chance of a liability notice you have to dispute. For the cost of preparing the supporting documents themselves, see PlanScope pricing.

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