On 30 June, the Government laid out Coronavirus CIL amendment regulations, the purpose being to try to reduce cash flow issues for developers.
What are the changes?
- Developers can ask for deferrals, but importantly only for CIL payments due from the date that the amendments come into effect (TBC but expected before 22 July) and 31 July 2021. This is not retrospective but looking at any payments due soon and in the following year
- Developers can ask that any interest accrued on any CIL payment subject to a deferral request is credited against the CIL amount
Who is eligible?
A person who:
- Has received a CIL demand notice
- Is required to pay CIL between the date the amendments come into effect (TBC but expected before 22 July) and 31 July 2021
- Has an annual turnover not exceeding £45m [note that NPPG sets out some guidance to consider this]
- Is experiencing financial difficulties (which is defined as including such difficulties which would be likely to have an unacceptable impact on their economic viability) for reasons related to the effects of coronavirus resulting in difficulty paying the CIL
What is the procedure?
The person seeking the deferral must make it as a written request to the CIL collecting authority either (a) no more than 14 days before or (b) on or as soon as practicable after the CIL payment is due.
The authority must consider the request as soon as practicable and give its determination within 40 days of receipt.
The authority can ask for further supporting evidence which the person seeking deferral must provide within 14 days. National Planning Policy Guidance suggests evidence can include declarations from a responsible person or organisation (e.g. accountant or auditor) or Companies House annual returns.
How long is the deferral for?
If the authority considers the deferral is appropriate in the circumstances, they may grant a deferral for no more than six months from the date of receipt of the request.
No additional interest or surcharges should be applied for the deferred period.
Payment can be deferred more than once within the period of the Regs – between the date that the amendments come into effect (TBC but expected before 22 July) and 31 July 2021. So the latest a deferral request can be made is as soon as practicable after 31 July 2021 (said to be days or weeks, not months).
What if they refuse?
The CIL must be paid in line with the original demand notice (or any revised demand notice which has been served any time after the deferral request was made).
Surcharges / interest will be payable but not if the CIL is paid within seven days of the refusal.
There is no right of appeal.
The Mayor of London collects Mayoral CIL to pay towards Crossrail 2. The request still goes to the London borough and they then seek the Mayor’s approval for deferral / interest credit.