Our friends over at K Design And Build have shared this fantastic blog with us. It is all about CIL and how it affects the planning process.
It’s important when considering a renovation or extension that you’re aware of all the potential pitfalls and hidden costs. One that catches a lot of people out is CIL, which stands for Community Infrastructure Levy. This is a planning charge, introduced by the Planning Act 2008 as a tool for local authorities in England and Wales to help deliver infrastructure to support the development of their area. It came into force on 6 April 2010 through the Community Infrastructure Levy Regulations 2010. Development may be liable for a charge under the Community Infrastructure Levy (CIL), if your local planning authority has chosen to set a charge in its area. Most new development that creates net additional floor space of 100 square metres* or more, or creates a new dwelling, is potentially liable for this levy.
So, for example, one of our recent projects involved a proposed extension in excess of 100s/m. If you renovate and extend up to 99.9s/m, there is no levy to pay. Anything over that, and you’re charged an amount (ours would have been £300 per square metre).
If you’re looking to renovate or extend your home, then you need to be aware of the levy and take it into consideration when doing your researching and planning. Many people aren’t aware of it, and are subsequently caught out by the substantial cost that follows.
Like everything, there are restrictions, limitations and loopholes. For example, if you’re extending your existing property by more than 100s/m, but you can prove your intention is to live in it, then you can avoid charge in some circumstances.
You can also charge by submitting more than one planning application, though we don’t advise this. So, let’s say you were looking to extend by 125s/m, you could theoretically submit two applications: one for 99 s/m, the other for 26s/m (which could be your garage extension, for example). However, please be advised by doing this, you could then be liable for tax avoidance. Furthermore, the mere act of submitting two applications means double the paperwork, red tape and, in many circumstances, cost.
The simple solution is to reconsider your plans and educate yourself on the possible charges should you wish to extend beyond 100s/m. Not every architecture will know about the levy. Some may know about it, but might not have your best interests at heart.
It pays to be prudent. We’ve heard cases whereby architects haven’t made customers aware of CIL, or even that there are two stages of planning application; a planning stage and a building-consent stage that need to be incorporated a total cost. In fact, we have worked on two projects this year where this has cost our clients a lot of money, purely because their architects weren’t aware, or didn’t inform them. There’s no point having architecture plans that look pretty, but which can’t be built on budget.
Be aware, be smart and know your restrictions.
If you would like to find out more about CIL, please visit www.pas.gov.uk/community-infrastructure-levy
* We estimate 100s/m to be the average size of a two-floor, three-bedroom (or small bedroom) property
Disclaimer – This is a guest blog and therefore does not represent the views of Right Surveyors Ltd or any affiliated company