CIL – substantial late payment surcharge upheld

29 Jun 2021

Developers will be aware of the intricacies and complexities contained in the Community Infrastructure Levy (“CIL”) regime: with charges as high as £500/m2 in some parts of the country, one wrong step or mis-application of the law (which is generally described as complicated and inflexible) could result in a big financial penalty.
The High Court has recently determined a case relating to the application of interest on the late payment of CIL.  In the case of R on the Application of the London Borough of Lambeth v Secretary of State for Housing, Communities and Local Government [2021] EWHC 1459 (Admin), a late payment surcharge of £465,617 was upheld.
In this particular case, the Council had issued various CIL Liability and Demand Notices taking into account a variation of the planning permission.  Those variations resulted in changes to the gross internal area and therefore changes to the amount of CIL payable.  The developer had not paid the initial Demand Notice within 30 days, giving the Council the opportunity to apply a surcharge of 5%.
The surcharge was re-imposed on subsequent Demand Notices issued and ultimately appealed to the Planning Inspectorate.  The developer argued that only the final Demand Notice should apply and any surcharge should only arise if that had not been paid within 30 days (which they had done).  The Inspector agreed with the developer and found that new Demand Notices essentially override old. 
The Council challenged the Inspector’s decision to the High Court and won, confirming that the surcharge should apply.  The High Court held that the Demand Notices did not have the effect of overriding the previous surcharges applied; and this would be an unsatisfactory effect of the CIL regime. 
The CIL regime is notoriously inflexible and should be followed to the letter to avoid late payment interest and surcharges which can be substantial and unexpected.  The lesson reinforced by this case is to ensure that CIL is paid in a timely manner, or to consider appealing if the figures are not agreed (subject to there being a legal basis for non-agreement). 

If you are looking for advice on CIL or similar planning matters, please do get in touch.

Further reading

Pensions on divorce – Spring Budget 2023

What are Lifetime Allowances and how does the Spring Budget affect my pension?
Read more Read

Commercial Landlords and Tenants should beware the tightening of the Minimum Energy Efficiency Standards on 1 April 2023

The Minimum Energy Efficiency Standards are tightening - Ben Price sets out the main issues to consider to avoid significant penalties
Read more Read

The Real Estate team continues to grow at DMH Stallard

Blog, News & PR
“The combination of Graham’s excellent reputation in the market, network of contacts and undoubted knowledge and expertise, make this a very exciting appointment for us."
Read more Read

Selling your loved one's home after death

A useful guide to help navigate the house sale process after a bereavement
Read more Read
  • Brighton - Jubilee St

    1 Jubilee Street


    East Sussex

    BN1 1GE

  • Brighton - Old Steine

    47 Old Steine


    East Sussex

    BN1 1NW

  • Gatwick

    Griffin House

    135 High Street


    West Sussex

    RH10 1DQ

  • Guildford

    Wonersh House

    The Guildway

    Old Portsmouth Road



    GU3 1LR

  • Hassocks

    32 Keymer Road


    West Sussex

    BN6 8AL

  • Horsham

    Ridgeland House

    15 Carfax


    West Sussex

    RH12 1DY

  • London

    6 New Street Square

    New Fetter Lane


    EC4A 3BF

  • Make an enquiry

    Make an enquiry


    Or head to our Contact us page