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Community Infrastructure Levy - don't get caught out when seeking retrospective approval!

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Our Planning team reviews a recent High Court Decision which held that it was not possible for a developer to claim the self-build housing exemption in respect of the Community Infrastructure Levy (CIL) charge, where the development was first authorised by a retrospective planning permission granted pursuant to section 73A of the Town and Country Planning Act 1990 (TCPA 1990). 

In the case of Gardiner v Hertsmere Borough Council [2021] EWHC 1875 (Admin), the developer had originally obtained planning permission for the partial demolition and extension of his bungalow. However, on implementing the consent the local planning authority (LPA), having undertaken a site visit, considered that the works carried out were more extensive than permitted and were therefore considered to be unauthorised.  The developer did not question this finding and submitted a new planning application to regularise the demolition works carried out, and to permit the subsequent rebuild of the house.  Planning permission was subsequently granted, in part retrospectively, for the demolition of the bungalow and the erection of a new detached 6-bed dwelling.

The development was carried out in the borough of Hertsmere which has a CIL charging schedule in place. Having submitted the revised application, the developer became aware that the development of the new dwelling was now liable to a CIL charge.  There are a number of exemptions available to CIL, subject to certain criteria being met, one of which applies to self-build developments (Regulation 54B of the CIL Regulations 2010 (as amended)).  The developer submitted the necessary CIL forms and sought to claim the self-build exemption for the development. The LPA took the view that the self-build exemption did not apply to the retrospective permission and issued a liability notice for the CIL charge in the sum of £118,227.62.  The developer applied to judicially review the decision of the LPA not to apply the self-build exemption in this case.

The Court considered the circumstances, and unfortunately for the developer, held that the self-build exemption was not available where the development had first been authorised by a retrospective planning permission under Section 73A of the TCPA 1990. It was considered that eligibility for the self-build exemption was tied to the grant of planning permission, and therefore was not granted automatically to anyone who built their own dwelling. A person wishing to benefit from the self-build exemption had to wait until they had been notified of the LPA's decision before commencing development. That requirement could not be fulfilled in this case as the works had already commenced prior to the LPA reaching a decision on the application of the CIL exemption.

The decision further highlights the importance of ensuring that the application of any CIL charge to the development has been considered at the outset. As CIL is operated akin to a tax there is very little flexibility in the application of the Regulations and we have seen previously that failings in procedure, such as a failure to submit the correct forms, has led to penalty charges being applied and/or exemptions being lost.   In order to claim the self-build exemption future developers must ensure that they comply with the requirements of the planning permission granted, and make sure that any amendments to the permitted development are formally approved by the LPA before being carried out.


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