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Community Infrastructure Levy (CIL) advice for self-builders
06 Sep 2022

When the Community Infrastructure Levy (CIL) was first introduced, it was to address the importance of recognising the impact of new developments on the local environment and sought to ensure that the necessary infrastructure to support that local area was provided. 

This was achieved by applying a fixed rate levy to all developments based on the amount of new floorspace created with rates varying depending on the type of development proposed, as well as on the Council setting it.  Indeed, some Councils have not adopted it at all.  Several exemptions to the levy were made and amongst those eligible were self-builders constructing a self-build home.  However, these exemptions were always subject to certain conditions being met and as several recent cases have illustrated, self-builders who aren’t entirely familiar with what those conditions are, run the risk of incurring costs that even their build contingency may not cover.  Here, Suzanne Tucker from FBC Manby Bowdler’s Town and Country Planning team outlines how to remain compliant with CIL exemption rules.

Whether you’re a seasoned property developer, an experienced builder taking on your first self-build project away from larger developments, or an enthusiast with a dream for a truly unique home of your own making, once your vision has been translated into workable plans, your team has been assembled, your plans approved and the budget set, you may think that you’re good to go.  You may wish to think twice. 

Being aware of the appropriate legislation not only when planning your scheme, but also when you commence your self-build project, and throughout its duration is advice that all self-builders would do well to heed - especially when it comes to CIL exemptions.

Whilst each individual self-build dwelling will give rise to a similar impact on the local infrastructure as a dwelling forming part of a larger scheme, and so arguably the CIL payable should be the same, when it was introduced, the government of the day was keen to encourage self-builders and so the exemption was introduced.  It is, however, vital to be abreast of what your obligations are in this respect.

Not only do you need to apply for and secure the exemption at the planning stage (for which you must satisfy many requirements, including demonstrating that the property will be your sole or main residence), and you must formally assume liability to pay the CIL in advance, you must also inform the local planning authority of your intended project start date to comply with the exemption.  You must then provide further evidence of the self-build status within six months of your completion certificate, and if any ‘disqualifying events’ occur within three years of the completion certificate (e.g. the dwelling is sold or let), the exemption secured falls away and the CIL becomes payable.  

Further complexities arise where there are variations to the scheme after planning permission has been granted.  In particular, where retrospective consent is secured for such changes, then the exemption will no longer apply, leaving you with a significant and unexpected liability.

In many cases, self-builders jump through all these hoops, but still find themselves being penalised because the Council has not received or kept a record of the information submitted.  At each stage it is important that you check that all notices and associated documentation has been received and is in order before proceeding to the next stage – assuming receipt of an email or hard copy simply isn’t good enough and any discrepancies are unlikely to go in the favour of the self-build applicant where these checks haven’t been made.

Whilst the penalty for this is less severe than it once was, changes made in 2019 mean that failure to inform the local authority of your commencement date will leave you liable to a penalty surcharge – something which can add a costly extra line to your overall project spreadsheet!

It is also worth remaining mindful of the fact that this isn’t ‘just’ an exemption.  The legalities linked to the CIL Levy exemption should be taken as seriously as any tax documentation with implications for non-adherence potentially being as serious and costly.

Any prospective self-builder who wishes to check their planning liabilities and the procedure for securing and retaining any associated exemptions, should seek legal advice at the outset of their project to avoid falling foul of costly errors. 

Suzanne and the FBC Manby Bowdler specialist planning team have extensive and recent experience representing clients who have faced issues relating to the CIL Levy exemption for self-build projects and testimonials are available on request. Suzanne can be contacted on 01743 266294 or email suzanne.tucker@fbcmb.co.uk.

Meet Suzanne Tucker