This page explains the principles behind the new Community Infrastructure Levy (commonly known as "CIL"), why it is better than a legal agreement and how it works in practice.

 

What is CIL?.

Why CIL is better than S106 agreements?.

What is the charge in Redbridge?.

Exemptions.

How it works in practice.

Appealing against the charge.

Late payments and non-notification.

Further information


What is CIL?

CIL is a charge on new buildings and extensions to buildings according to their floor area. In this way money is raised from development to help the Council pay for schools, leisure centres, aged care accommodation, roads and other infrastructure and utilities to ensure the borough grows sustainably.

CIL replaces the section 106 “tariff” which has previously been used for this purpose. Section 106 will continue to be used for affordable housing and anything required just for the specific development site to make it acceptable in planning terms, for example, a new access road.


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Why CIL is better? 

  • CIL is certain, predictable and transparent and developers can factor it into schemes from an early stage. The Government thinks it will eventually be factored into land values
  • It has been subject to rigourous viability testing which shows it to be a relatively modest charge
  • Grounds for appeal limited to technical issues
  • Enforcement powers are robust
  • It does not slow down the development approval process
  • Once established, it has a relatively low administrative cost
  • CIL will deliver more community infrastructure funding than S106 because it catches a wider range of developments


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What is the charge in Redbridge?

  • The Redbridge CIL is a single flat rate charge of £70/m2 applied uniformly across the whole borough and the same rate applies to all types of development
  • CIL applies to the net increase in gross internal floor area after allowing for any demolition
  • If the gross internal floor area of new build is less than 100m2, the development does not pay CIL, regardless of any demolition
  • If a new dwelling is being created, it will always pay CIL for any net increase in gross internal floor area


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Exemptions

Three types of buildings don’t pay any CIL:

  1. Buildings into which people don’t normally go, or only go into to perform maintenance. This covers things like water pump houses or electrical substations.
  2. Affordable housing subject to certain criteria.
  3. Development by charities for charitable purposes subject to certain criteria. 

 

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How it works in practice

Applicants must provide information about the GIA of buildings before and after development, or their application will be invalid.

If CIL applies, the Council will calculate the amount and show this on a Liability Notice issued along with the Decision Notice.

Before development commences the person who will pay CIL should serve an Assumption of Liability Notice on the Council.

The developer must serve a Commencement Notice on the Council once construction begins. This is the trigger for the Council to serve a Demand Notice for the amount of CIL -there are usually 60 days to pay. If there is no Commencement Notice and the development starts, penalties apply and CIL is payable immediately.


 

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Mayor of London's CIL

  • In April 2012 the Mayor of London plans to start operating a CIL to help fund Crossrail. It is still subject to examination but the proposed charge is £35/m2 in Redbridge
  • When the Mayoral CIL commences, the two charges will simply be added together, making a potential total of £105/m2. The Council will collect the entire amount and pass the Mayor’s slice on to Transport for London
  • Developers will just have to pay the one consolidated charge
  • The charges will be adjusted annually for inflation


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Appealing against the charge

All appeals are made to the Planning Inspectorate using the written representations process, and may only be made on these grounds:

  1. That the Council incorrectly calculated the amount of CIL. (Before making the appeal the developer must first request an internal review by the Council)
  2. That the Council incorrectly apportioned liability between landowners
  3. That the Council incorrectly determined Charitable Relief
  4. That the Council incorrectly applied surcharges
  5. That the Council deemed the development to have commenced when it did not
  6. That the Council incorrectly issued a Stop Notice for non-payment


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Late payments and non-notification

  • For failure to submit a Commencement Notice
  • Where the Council has to apportion liability between different owners
  • For failure to notify the Council of a disqualifying event within 14 days
  • For late payment
  • Failure to comply with an information notice within 14 days
  • Late payment interest is charged at 2.5% above the Bank of England base rate


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Further information

 

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