Mind the gap: The Community Infrastructure Levy (CIL)

CIL charges in London will change from 1 April. Read on to find out more about them and what they could mean for your developments.

2/15/2019 12:00:00 AM

What is CIL?

CIL is the "Community Infrastructure Levy". It is a planning charge that local authorities can use to gather contributions for infrastructure in their area. The Mayor of London has set CIL charges across London ("Mayoral CIL"). In addition, local authorities can apply their own CIL charges on top of the Mayoral CIL.

The amount of CIL payable is calculated and finalised at the time planning permission is granted.

With the average CIL rate for residential developments across all CIL adopters in England at £95 per square meter (according to a 2017 government report on the value, impact and delivery of the CIL), CIL can significantly increase the cost of your development.

What is changing?

Mayoral CIL charges for London are changing. They are being increased on 1 April 2019. The higher CIL contributions will seek to gather contributions for Crossrail 2.

The table below shows the difference between the old Mayoral CIL rates (that apply to CIL liable developments granted permission before 1 April 2019) and the new Mayoral CIL rates (that will apply to CIL liable developments granted permission on or after 1 April 2019) according to the draft charging schedule, which has been recommended for adoption.

Zone London boroughs

"Old" Rates (pre 1 April 2019)
(£ per sq. m.)

"New" Rates(from 1 April 2019)
(£ per sq. m.)

1 Camden, City of London, City of Westminster, Hammersmith and Fulham, Islington, Kensington and Chelsea, Richmond-upon-Thames, Wandsworth £50 £80
2 Barnet, Brent, Bromley, Ealing, Greenwich, Hackney, Haringey, Harrow, Hillingdon, Hounslow, Kingston upon Thames, Lambeth, Lewisham, Merton, Redbridge, Southwark, Tower Hamlets £35 £60
3 Barking and Dagenham, Bexley, Croydon, Enfield, Havering, Newham, Sutton, Waltham Forest £20 £25

These rates apply to all development in London but not to office, retail and hotel in Central London and the Isle of Dogs (see rates below) or health and education in all of Greater London (nil rates apply).

A fourth charging band will be introduced from 1 April 2019 that applies to office, retail and hotel development in Central London (excluding the Elephant and Castle Opportunity Area) and the Isle of Dogs. Within these two areas the proposed rates per sq. m. are £185 for offices, £165 for retail (including use classes A1-A5 and related sui generis uses) and £140 for hotels (including apart-hotels).

The increased and new tariffs could significantly increase the cost of your development.

Action you need to take

In order for planning permission to be granted before 1 April 2019 (and to avoid the higher CIL charge), your section 106 planning agreements and section 278 highways agreements will need to be completed before this date.

Please get in touch with the Planning team if you want assistance auditing your planning applications and negotiating your section 106 or section 278 agreements as expeditiously as possible.

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