A worked CIL liability calculation

Community Infrastructure Levy liability is arithmetic, not judgement. The formula sits in Schedule 1 to the Community Infrastructure Levy Regulations 2010: the charging authority's rate multiplied by the chargeable area, then adjusted by two index figures. Get the measurement and the existing floorspace deduction right and the number falls out. Get either wrong and you are arguing with a demand notice after permission has been granted, which is a much worse place to be.

This walks through the calculation on a small residential scheme, then covers the reliefs and the forms, which is where self-builders lose money they were entitled to keep.

What the charging schedule gives you

Each charging authority adopts a CIL charging schedule after examination. It sets a rate in pounds per square metre, usually varying by development type and often by geographical zone within the district. Residential rates in a high-value zone can differ sharply from the same authority's rate three miles away, and some authorities set a nil rate for particular uses.

Three things to pull off the schedule before you calculate anything:

• The rate that applies to your development type and the zone your site sits in.
• The date the charging schedule took effect, because that date fixes one of the two index figures.
• Any instalment policy, which determines whether the bill arrives as one payment or several.

Instalment policies are discretionary and they lapse if you fail to serve a commencement notice. That single administrative point costs small developers more than any argument about measurement.

Measuring gross internal area correctly

CIL is charged on gross internal area, measured to the internal face of the external walls. Internal walls, partitions, stairwells, lift shafts, plant rooms and integral garages are all inside the measurement. Balconies and open canopies are not. An attached garage counts. A detached garage counts as a separate building if it is a building.

The measurement is taken from the approved drawings, so the schedule of areas you submit with the application is effectively the basis of the charge. Councils check, but they check against what you gave them.

Loft space is the usual dispute. Where a room in the roof has permanent access, headroom and a floor, treat it as floorspace. Where the roof void is unusable and unlit, it is not. If the drawings show a staircase to it, expect the collecting authority to count it.

Deducting existing floorspace that qualifies

The deduction is what makes or breaks most small-scheme calculations, and the test is strict. Under Schedule 1, the floorspace of an existing building may be deducted where the building contains a part that 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.

Two words do the work. Lawful, meaning the use had planning permission or was immune from enforcement. And in use, meaning actually occupied for its lawful purpose rather than standing empty.

Evidence of the six months is on you. Council tax records, utility bills showing consumption rather than standing charges, business rates records, tenancy agreements and dated photographs are the usual bundle. A bungalow that has been empty for four years while probate was sorted out will not qualify, and the owner will not find that out until the liability notice arrives.

Buildings to be demolished count on the same test. Buildings that were never lawful do not count at all.

The calculation, step by step

The chargeable amount for a rate is the rate multiplied by the chargeable area, multiplied by the index figure for the calendar year in which planning permission was granted, divided by the index figure for the year the charging schedule took effect. The index is published annually and the figures for both years must come from the published series, not from an estimate.

Here is an illustrative worked example. Every figure below is invented for the purpose of showing the method, and you must substitute the actual rate from your charging schedule and the actual published index figures for the two relevant years.

The chargeable area is 180 minus 55, which is 125 m². Multiply by the rate: 125 times £100 gives £12,500. Now apply the indexation: multiply by 381 and divide by 305, which is a factor of 1.2492. The chargeable amount is £15,614.75.

Two observations from that. First, indexation is not a rounding error. On this illustrative pair of figures it adds nearly a quarter to the bill, and the gap widens the longer ago the charging schedule was adopted. Second, the existing floorspace deduction saved £6,870 on the same illustrative numbers, which is why the six-month evidence is worth assembling properly rather than hoping.

Where a scheme has more than one rate, for example residential and retail floorspace in one building, the calculation is run separately for each rate and the results added.

Reliefs and exemptions, and the deadlines that kill them

Several reliefs exist. The ones small applicants meet most often are these.

Minor development. Where the net additional floorspace is less than 100 m² and no new dwelling is created, the development is exempt. Note the net: a 130 m² extension with a 40 m² demolition can fall under the line.

Residential extensions and annexes. An extension to your own home, and a residential annexe within the curtilage, can be exempt on a claim, subject to conditions about the annexe not being sold separately.

Self-build housing. A dwelling built by or commissioned by an individual for their own occupation is exempt, but the claim is a two-part process and both parts have hard deadlines. Part 1 must be submitted and acknowledged before development starts. Part 2 must be submitted within six months of completion with the supporting evidence the regulations list, typically the building control completion certificate, proof of title and evidence that the dwelling is your principal residence. The exemption is clawed back if the property is sold or ceases to be your main residence within three years of completion.

Social housing and charitable relief also exist, with their own claim procedures.

Every one of these reliefs is lost if you start on site before the claim has been granted and a commencement notice served. There is no discretion to reinstate it.

Forms, notices and the order they go in

1. The collecting authority issues a liability notice after permission is granted, setting out the chargeable amount and the payment arrangements.
2. Submit an assumption of liability form. Someone must assume liability, or the charge falls on the landowner with a surcharge.
3. Submit any relief or exemption claim, and wait for it to be granted in writing.
4. Serve the commencement notice before any material operation starts on site. Digging a trench for foundations counts. Erecting hoardings may count.
5. The authority issues a demand notice setting out the payment dates.
6. Pay on the dates given, or lose the instalment policy and attract late payment interest and surcharges.

Where you think the chargeable amount is wrong, the route is a request for review by the charging authority within 28 days of the liability notice, then an appeal to the Valuation Office Agency on the calculation itself. Appeals against surcharges and against the deemed commencement date go to the Planning Inspectorate. These are short windows, and missing them leaves you with the number.

Levy reform is coming. The Levelling-up and Regeneration Act 2023 contains powers for an Infrastructure Levy intended to replace CIL over time, but the powers have not been fully brought into force and CIL is still the operative regime. Check the current position before advising anyone on a long programme.

Where CIL sits in the wider cost picture

CIL is a fixed charge, not a negotiation. Unlike a section 106 obligation, it is not open to a viability argument at application stage, although viability evidence is relevant when the charging schedule itself is examined and when an authority considers exceptional circumstances relief where it has adopted one. Where a scheme is marginal, the viability assessment needs the CIL figure in it as a fixed cost line from the start.

Set the CIL position out plainly in the planning statement, with the area schedule, the deduction claimed and the evidence for it. Officers pass it to the CIL team, and a clear statement heads off the demand notice that assumes no deduction applies.

This is general guidance, not legal advice. Rates, index figures and instalment policies change, so check the current charging schedule and the published index before relying on any number here. PlanScope provides AI-assisted draft reports for planning applications, and those drafts flag missing site facts rather than inventing them. Reports should be reviewed before submission. We do not guarantee planning approval.

Work out which of the 66 report types your scheme needs, or see PlanScope pricing for one free report, £50 per report, or Professional for unlimited reports.