The Infrastructure Levy power and why CIL still applies

The infrastructure levy cil question has a short answer as at October 2026: the Community Infrastructure Levy still applies, and the Infrastructure Levy does not. Part 4 of the Levelling-up and Regeneration Act 2023 created the power to make a new levy, but the power has not been exercised through regulations, so the Community Infrastructure Levy Regulations 2010 remain the operative regime alongside section 106 planning obligations. Budget on that basis and track the position rather than the headlines.

What the 2023 Act enables

The Act inserts a framework for a locally set charge on development, intended to be mandatory for charging authorities rather than optional, and intended to be calculated on the value of development once completed rather than on floorspace at the point of permission.

The design features that were announced are worth understanding, because they shape what any future regulations are likely to look like. A rate set by the charging authority and examined, a charge keyed to gross development value above a threshold, a right-to-require mechanism allowing the authority to take part of the levy as on-site affordable housing, and a narrowed role for site-specific obligations.

None of that has legal effect until regulations are made. The Act supplies the power, and the detail that matters for a cash-flow model, the rates, the thresholds, the exemptions and the payment triggers, all sit in regulations that do not yet exist.

How the levy differs from CIL

The practical difference for an appraisal is the point at which the liability becomes certain. A floorspace charge can be calculated the day a layout is fixed. A value-based charge cannot, which transfers risk from the authority to the developer in a rising market and the other way in a falling one.

The role of section 106 under the new regime

Section 106 is not going anywhere in the near term. It remains the only mechanism for most site-specific mitigation, for affordable housing on major schemes, for restrictions on occupation and for the obligations that CIL cannot fund because of the regulation 123 style limits on pooling and on funding items already covered by the levy.

Under the Act's model, obligations were expected to continue for matters that are site-specific in substance, with a reduced role for the broad infrastructure contributions that the levy would absorb. Expect the familiar heads of terms to survive: highway works under section 278 of the Highways Act 1980, open space transfer and maintenance, travel plan monitoring, education contributions where the authority can evidence them, and affordable housing delivery with a cascade.

Monitoring fees are now routine and are charged by most authorities on a per-obligation or percentage basis, which is a line item people forget in an early appraisal.

Phased introduction and the current position

As at October 2026 no Infrastructure Levy regulations have been made, no charging authority is operating the levy, and the government's stated approach to developer contributions has shifted more than once since the Act received Royal Assent. The announced intention was a staged rollout, often described as test and learn, over a period of years.

Treat any timetable as provisional. The reliable way to check is the legislation itself on legislation.gov.uk, which shows which provisions of the 2023 Act are in force, together with the current developer contributions guidance on gov.uk. The reform tracker on the planning law timeline is the place to follow announcements, and plan-making changes under the same Act are covered in plan making reform and what happens to emerging plans.

One honest uncertainty: nobody drafting an appraisal today can say with confidence whether the levy will be implemented in the form the Act describes, in an amended form, or not at all. That is a reason to build flexibility into option agreements rather than to guess.

Budgeting while both regimes exist

For any scheme reaching decision in the next few years, model CIL and section 106 as they stand.

1. Find whether the authority has an adopted CIL charging schedule, because roughly a third of English authorities still do not.
2. Take the rate from the authority's current published rates, not from the adopted schedule, because CIL rates are indexed annually.
3. Calculate on net additional floorspace, deducting lawful existing floorspace that has been in use for a qualifying period, which is where most savings are found.
4. Identify the reliefs you can claim, including self-build, residential annexes and extensions, social housing relief and charitable relief.
5. Serve the required notices before development begins, because reliefs and payment-by-instalment are lost if work starts first.
6. Add section 106 heads of terms and monitoring fees, and treat them as a separate line from CIL.

Step three repays attention. Demolishing and replacing a building that has been in lawful use gives a floorspace credit, and the qualifying period and evidence requirements are strict enough that the paperwork needs assembling before the application rather than after.

What to watch in a charging authority

Four documents tell you where an authority sits. The adopted charging schedule gives the rates and zones. The annual rates summary gives the indexed figures actually payable. The infrastructure funding statement, which charging authorities publish each year, shows what has been collected and spent. And the local plan's infrastructure delivery plan shows what the authority expects to fund.

Read the funding statement before you argue about viability. An authority that has collected substantial sums and spent little has a weaker case for insisting on contributions that tip a scheme, and an authority with a long committed list has a stronger one.

Where contributions are marginal to the appraisal, the evidence has to be presented through a Viability Assessment prepared to the methodology in national guidance, and the affordable housing position set out in an Affordable Housing Statement.

Questions to ask before land purchase

Put five questions in the due diligence pack, and get the answers in writing where you can.

Does the authority have an adopted CIL charging schedule, and what is the current indexed rate for the relevant use and zone? Is there lawful existing floorspace on the site, and can its use be evidenced for the qualifying period? What section 106 heads of terms has the authority secured on comparable consents nearby? Does the site fall within any area where additional tariffs apply, such as a strategic infrastructure contribution or a nutrient or water neutrality requirement? And what does the option or contract say happens if a new levy regime changes the liability between exchange and implementation?

That last question is the one most often left out. A contract drafted on the assumption that CIL applies for the life of the option can allocate a risk that neither party has priced.

This is general guidance, not legal advice, and the position on reform is as at October 2026. Check the current developer contributions guidance on gov.uk, the position on which provisions are in force on legislation.gov.uk and the authority's own published schedules, and take advice from a qualified professional before relying on any of it. PlanScope provides AI-assisted draft reports for planning applications. Reports should be reviewed before submission. We do not guarantee planning approval.