Community Infrastructure Levy - Frequently Asked Questions

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What is the Community Infrastructure Levy (CIL)?

CIL is a charge that local authorities can make on new development in their area in order to fund infrastructure improvements to manage the impacts of development and support population growth. Councils do not have to adopt CIL, but it is the Government's preferred means of securing funding from developers for community infrastructure. 

Daventry District Council adopted CIL in September 2015. 


What types of development are liable to pay CIL?

In Daventry District, only residential and retail developments which create more than 100 square metres of new floor space are liable to pay CIL. 

In terms of use classes, 'Residential' means development which falls into use classes C3 or C4.  For the avoidance of doubt, the Council does not consider that use classes C2 and C2A fall within this definition.  'Retail' means development which falls into use classes A1, A2, A3, A4 or A5. 

Please note that the charge is made only on the net amount of new floor space that is created. So if a development includes a retained building ( such as a barn conversion), or a building needs to be demolished to make way for the new development, then the floor space of these buildings can be deducted from the gross floor space of the new development.  

However, these deductions are only allowable if the buildings in question have been in lawful use for a continuous 6 month period at any time over the last 3 years. In the case of retained buildings of the same use class, the recent lawful use rule does not apply.


What are the CIL rates in Daventry District?

CIL is calculated on the total new floor space of a development (over and above the 100 square metre threshold described above).  Local Planning Authorities must apply indexing to their charging schedule, to cover construction industry inflation costs. This is applied at the beginning of the calendar year, according to the formula contained in CIL Regulation 40

The indexed rates for 2018 are as follows (prices per metre-squared):

  • Residential development in Daventry town or on an urban extension: £60.50
  • Residential development in rural areas that is above the affordable housing threshold (5 units or more): £78.65
  • Residential development in rural areas below the affordable housing threshold (less than 5 units): £242
  • Retail development in Daventry town centre retail zone: £0
  • Retail development in all other places: £121
  • All other development: £0


Are there any exemptions?

Development that creates less 100 sqm of new floor space is not chargeable. The only exception to this is a new dwelling, which is chargeable, whatever the size.

Exemptions from CIL can also be claimed for affordable housing, charities and by self-builders for new dwellings, extensions and annexes. 

To qualify for exemption, you MUST ensure:

  • You claim the exemption before any works, including demolition, start.
  • You submit a valid commencement notice before starting any works, including demolition
  • You do not make any changes to the development during construction (e.g. a section 73 application) 
  • You do not sell or let out the property or annexe within the first three years of occupation. 

For new dwellings, a Self-Build Exemption Claim Form Part 2 along with all required documentation must be submitted within 6 months from the date of completion.

If you wish to make changes to an existing permission you are strongly advised to speak to the case officer handing your application for planning permission first. 


How does the CIL process work?

  1. If you are submitting a planning application and it is CIL liable you must also submit a completed CIL additional information form with your application.
  2. The Council will then check the floor space measurements, calculate your CIL liability and validate your application.
  3. You must then complete and return an Assumption of Liability form, accepting you are responsible for paying the CIL charge on the development.
  4. If your application is approved, the Council will issue a CIL Liability Notice, and you must then complete and submit a Commencement Notice before starting work. Failure to do so may result in you losing the ability to pay the levy in instalments and you may also incur a surcharge. Failure to submit a Commencement Notice before starting work will disqualify you from any exemption on the levy that you may have received.
  5. The Council will issue a demand notice for CIL payment. Payment will ordinarily be due within 60 days of work starting.


Download the CIL collection process chart


Can I pay CIL by instalments?

On developments where the CIL owed is less than £60,000, the Council will ordinarily demand payment in full within the first 60 days of work starting. However, for developments where the CIL is £60,000 or greater, payment can be made by instalments. This is explained in greater detail in the Council's Instalment Policy and Schedule


What are the penalties for not complying with the CIL regulations?

The Council has a range of options available if you do not submit the correct forms and notices or do not pay the CIL within given time frames. The Council will be proportionate in its compliance action, but it could include any or all of the following:

  • Payment benefits (such as instalments) can be forfeited.
  • Surcharges can be applied
  • A stop notice on the development can be issued until payment received
  • A court order can be sought to recover payment.

 

What is the income from CIL charges spent on?

Councils that introduce CIL must produce a Regulation 123 List which indicates the specific community infrastructure that might be funded from CIL. The Council’s Regulation 123 List contains all the ‘big ticket’ items such as major road projects, secondary education and strategic waste facilities that CIL will fund. Download the Council's regulation 123 list

The Council must also publish an annual report detailing CIL income and expenditure. Find out more and download the annual CIL reports here


Do Parish Councils benefit?   

Parish Councils will get a proportion of the CIL receipts raised from development in their Parish. 

If they have a Neighbourhood Plan in place, they will get 25% of the receipts and they will be expected to use these to deliver proposals in their plan. If so minded, they can return some of these receipts to higher authorities to enable mutually beneficial projects to proceed. 

Parishes that do not have a Neighbourhood Plan will get 15% of the receipts and this will be capped at an equivalent of £100 per dwelling per year.  

For Parishes that have no council, DDC will retain 15% of the CIL receipts raised in the Parish and will engage with local residents in order to decide how the funds should be spent. 


A CIL guide for Parish Councils can be viewed below. Alternatively you can download the document in pdf format 


What is the difference between CIL and Section 106?

Section 106 agreements are put in place to make it possible to approve a planning proposal that might not otherwise be acceptable in planning terms. For example, a section 106 agreement might require a developer to fund improving the access road to a site, to ensure that access will be safe once the development is completed. Section 106 agreements could also require a developer to include a certain proportion of affordable housing on an otherwise market housing development.

CIL is a general levy on all development, designed to raise funds for infrastructure needed generally as a result of an increase in development in an area.

A number of items which previously would have been funded by Section 106 agreements are now funded by CIL. Find out more information about the consequences for Section 106 since the introduction of CIL. 


More information

These FAQs do not cover the entire CIL Regulations, nor do they cover the full range of development scenarios.  

You can find a comprehensive guide to CIL on the Gov.uk website

Property specialist barrister Christopher Cant has also produced an insightful guide to CIL that includes reference to case law.

For more information contact the Council’s CIL officer on 01327 871100 or email cil@daventrydc.gov.uk