The Planning Act 2008 provides for a discretionary planning charge known as the Community Infrastructure Levy (CIL) but it only came into effect with the publication of the Community Infrastructure Levy Regulations 2012. Despite several attempts amending the regulations to make the new regime workable and more effective in practice, the Government has made interesting proposals of reform through the Community Infrastructure Levy (Amendment) Regulations 2014.

So, what’s new?

The amended regulations provide more opportunities to calculate, collect and spend the CIL.

The key changes are:

  • Deferring the date from which the restrictions on the use of S106 obligations apply to April 2015 (currently, the date is April 2014), which in effect defers the date by which authorities are forced to introduce CIL.
  • Allowing all types of planning permissions to be treated as phased development to ensure the fair treatment of more complex developments.
  • Allowing the CIL liability to be paid in whole or in part through the provision of land and/or on-site or off-site infrastructure.
  • Extending the vacancy test to cover buildings that have been in use for a continuous period of six months in the last three years prior to the grant of planning permission (currently the six-month period is calculated within a 12-month period). This is significant.  If the test is satisfied, CIL is then not payable on floor space equivalent to the existing amount on site. There is a proposal to change when the three-year period is calculated from (otherwise known as the date when the permission “first permits the development”).
  • Providing that a building has not been abandoned, there is no change of use nor no increase in floor space the development will be exempt from the CIL and therefore ensuring that design changes are allowed.
  • Requiring authorities to strike an appropriate balance between the funding of infrastructure from the CIL and the potential effects of the CIL on the viability of development.
  • Allowing authorities to set differential rates by reference to the proposed size of development, or the proposed number of units or dwellings.
  • Allowing an exemption for residential annexes and extensions and for self-build housing; an extension of affordable housing relief to other forms of affordable housing and an amendment to allow for infrastructure to be provided as a payment in kind for CIL.

Future looking bright?

Developers and Local Authorities may argue that these reforms heighten CIL’s complexity, but essentially, the reforms reflect the Government’s desire to make CIL flexible for delivering infrastructure.

For information regarding Edwin Coe and the Property and Construction group please visit http://www.edwincoe.com/services/property.asp

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