Regulation 55 relief from the infrastructure levy
Relief from the Community Infrastructure Levy under regulation 55 is real but narrow. Here are the gateways, the three tests, the evidence needed and the routes that usually serve better.
Relief from the Community Infrastructure Levy in exceptional circumstances exists, and most developers who ask for it discover it is not available in their area at all. The relief sits in regulation 55 of the Community Infrastructure Levy Regulations 2010, and before any individual claim can be considered the charging authority must first have taken a positive step: it must have given notice that relief is available in its area. Many have never done so. That single precondition disposes of more enquiries than the substantive tests ever do.
What the relief is for
The levy is deliberately blunt. A charging schedule is set by examination, applies a fixed rate per square metre by use and location, and is not negotiable application by application. That rigidity is the point, since it gives certainty and removes the haggling that used to attend infrastructure contributions.
Regulation 55 relief is the narrow safety valve for the case the schedule cannot sensibly accommodate: a site where the planning obligations needed to make the development acceptable are themselves so expensive that paying the levy on top would stop the scheme. It is not a hardship provision, a general viability discount, or a route to reopen a rate you think is too high.
As at October 2026 the levy remains the regime in force. The Infrastructure Levy powers in the Levelling-up and Regeneration Act 2023 have not displaced it, so check the current position before advising on anything with a long programme.
The precondition the authority must satisfy first
Before a claim can succeed, the charging authority must have made the relief available in its area and published notice to that effect. This is discretionary, it can be withdrawn, and it is the first thing to check.
Ask the authority directly, in writing, whether relief under regulation 55 is available in its area and when the notice was given. Do not rely on a sentence in a developer contributions document, because the question is whether the formal step was taken.
Two further gateways then apply at scheme level. There must be a section 106 agreement in place in respect of the planning permission for the chargeable development, so a scheme with no obligations cannot claim. And the claim must come from someone who has assumed liability and holds a material interest in the relevant land, made before work starts on site. Start on site first and the opportunity is gone.
The tests applied to the individual case
Assuming the gateways are passed, the authority must be satisfied of three things.
| Test | What it means in practice | Evidence needed |
|---|---|---|
| Cost of the obligations exceeds the levy liability | The section 106 package has to be more expensive than the chargeable amount, not merely substantial | Priced schedule of obligations against the calculated liability |
| Paying the full levy would have an unacceptable effect on economic viability | Assessed on the scheme as permitted, not on an alternative | Open book appraisal, usually independently reviewed at your cost |
| Relief would not amount to a notifiable subsidy | Framed in the regulations in state aid terms, now read alongside the Subsidy Control Act 2022 | Legal analysis, and sometimes an opinion |
The first test is the one that defeats most claims. A scheme carrying a modest obligations package and a large levy bill fails it immediately, however marginal the development. The arithmetic has to run the other way round, which in practice means sites with abnormal infrastructure obligations: a spine road, a bridge, off-site drainage, a school contribution on a site too small to spread it.
Viability evidence here is the same discipline as any other appraisal, with the same arguments about benchmark land value, developer return and abnormal costs. Our note on when an inspector reopens viability at appeal covers how that evidence is tested, and the method is set out on the Viability Assessment page.
Why the relief is rarely granted
Four reasons, and they compound.
Most authorities have never made the relief available, because doing so invites claims and reduces a predictable income stream. Where it is available, the obligations-exceed-levy test excludes the common case. The evidence burden is heavy and the independent review is paid for by the claimant. And any grant has to survive the subsidy analysis, which authorities approach cautiously on advice.
There is also an institutional point worth naming. Levy income is already committed in infrastructure funding statements and capital programmes, so an officer granting relief is removing money someone has spent on paper. That is a practical obstacle regardless of the merits.
Building a claim that is capable of succeeding
If the gateways are open, the claim should read as a reconciliation rather than a plea.
- Confirm in writing that relief is available in the area, and record the date of the notice.
- Set out the chargeable amount with the calculation, including any existing floorspace offset you are entitled to.
- Price the section 106 package item by item, with third party quotations for physical works and the agreed figures for financial contributions.
- Demonstrate that the obligations cost exceeds the levy liability, showing the comparison on a single page.
- Provide an open book viability appraisal of the permitted scheme, with sensitivity testing, and offer to fund the authority's independent review.
- Address the subsidy question squarely, with reasoning rather than an assertion.
- Confirm the claimant's material interest and that liability has been assumed, and submit before any work starts.
Expect conditions. Relief is granted in respect of the chargeable development and can be withdrawn where a disqualifying event occurs within the clawback period, including a change of use or a transfer that alters the basis on which relief was given. Diarise those dates, because the consequence of a disqualifying event is a demand for the full amount.
Where relief is refused, or unavailable
Most schemes get there by a different route, and several of these are more reliable than regulation 55.
- The existing floorspace offset. Where a building on the site 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, that floorspace comes off the calculation. Evidencing historic lawful use is often worth more than any relief claim.
- Instalment policies. Where the charging authority has adopted one, the liability can be spread, which solves a cash flow problem even though it does not reduce the bill.
- Payments in kind. Some authorities accept land, and some accept infrastructure payments, where they have resolved to do so.
- The mandatory and discretionary reliefs: social housing relief, charitable relief, the self-build exemption, and the residential annexe and extension exemptions. Each has its own paperwork and strict timing before work starts.
- Reducing the chargeable floorspace, or revising the scheme under section 73, bearing in mind that a new permission recalculates the liability and that obligations may need to be retied, as discussed in our note on whether section 106 obligations carry over to a section 73 permission.
- Restructuring the obligations themselves, so that works are delivered under a highways agreement rather than a planning obligation where that is appropriate. The division of responsibilities is set out in our piece on which agreement secures what.
That last point deserves emphasis. Where an item could be secured under section 278 as highway works, moving it changes the obligations total, which cuts against the first relief test. Decide which outcome you are aiming for before the agreement is drafted.
The practical sequence on a live scheme
Resolve the levy position before the section 106 agreement is signed, not after. Once the agreement is completed and the permission issued, the obligations are fixed and the comparison with the levy liability is whatever it turns out to be.
A workable order: calculate the likely liability early from the charging schedule, confirm the relief position with the authority, price the draft obligations, test the comparison, and only then decide whether to pursue relief, restructure the package, or absorb the cost. Leave it until the liability notice arrives and the options have narrowed to paying.
Enter your postcode on PlanScope to see which supporting documents a scheme of this kind needs, then take the levy calculation to the charging authority in writing.
This is general guidance, not legal advice. The levy regulations have been amended repeatedly and relief turns on the charging authority's own published position, so check the current regulations and the authority's notices, and take advice from a qualified professional, before relying on it.
Frequently asked questions
What is regulation 55 relief from CIL?
A discretionary relief under regulation 55 of the Community Infrastructure Levy Regulations 2010. It is for schemes where the planning obligations needed to make the development acceptable cost more than the levy liability, and where paying the levy as well would make the scheme unviable. It is not a general viability discount.
Why do most claims for this relief fail?
Because the charging authority must first have made relief available in its area and published notice to that effect, and many never have. Where relief is available, the requirement that the cost of the section 106 obligations exceeds the levy liability rules out the common case of a modest obligations package and a large levy bill.
When must a claim for relief be submitted?
Before any work starts on site. The claimant must have assumed liability and must hold a material interest in the relevant land, and a section 106 agreement must be in place for the permission. Starting on site before relief is granted removes the opportunity entirely, so the claim belongs in the programme before work begins.
Does the subsidy control question really matter?
Yes. The regulations require that relief would not constitute a notifiable subsidy, a test framed in state aid language that now has to be read alongside the Subsidy Control Act 2022. Authorities take legal advice on this and approach it cautiously, so a claim should address it with reasoning rather than an assertion.
What alternatives exist if relief is refused?
The existing floorspace offset for buildings in lawful use for at least six months in the three years before permission, an adopted instalment policy, payments in kind or infrastructure payments where the authority allows them, the mandatory and discretionary reliefs, reducing chargeable floorspace, or restructuring how the obligations are secured.
Can relief be withdrawn after it is granted?
Yes. Relief is granted in respect of the chargeable development and can be clawed back where a disqualifying event occurs within the clawback period, including changes that alter the basis on which relief was given. Diarise the dates, because the consequence of a disqualifying event is a demand for the full amount.
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.