Warning!! - The new Community Infrastructure Levy tax is now here at Wycombe District Council.
(update April 2014 - Under pressure from the general public, the Government has now
exempted large home extensions from the CIL tax which is great news. I have retained the original article
below simply for interest)
Many Councils are now beginning to adopt the new Community Infrastructure Levy or CIL tax for new developments which can include home
extensions and even garden buildings built under permitted development.
This new developer tax is meant to fill the perceived funding hole of additional infrastructure caused by new
developments. So, you tell me how a detached swimming pool building in someone's back garden is going to
place extra demand upon 'the community infrastructure' that is then mitigated by payment of a £15,000.00 tax?
It's the 'Bryan Air' charging system for people who dare spend money improving their homes and quality of
Yes, you heard that right - A 'home extension tax' for projects of more than 100 square metres in the case for
Wycombe District Council planning applications.
Most Local Planning Authorities (LPA's) will have to change over from the old 106 legal agreement methods of
extracting money from developers / land owners to this new CIL tax by 2014.
Most local government officials will not refer to it as a tax as it is called a levy. In my book it is quite
clearly another tax. My own LPA have now adopted a charging rate of either £125 or £150 per square metre for
home extensions over 100M2 which, although large for a domestic extension scheme, it is not unusual for many
of our local projects. This came into force on November 1st 2012 and applies to all new Planning Approvals
issued after that date for chargeable schemes.
Just think about that charging cost for a moment and what it actually means for you. Yes, that equates to
around a 10% construction cost tax. So not only do home owners have to contend with 20% VAT on top of the
build cost they now have another 10% CIL tax inflating true construction costs by 30%.
However, like all legislation created by the 'gin swilling White Hall boffins' who's desire is to control our
'plebwellion' lives, there is scope to minimise this levy & in some cases avoid this tax
altogether by clever engineering and presentation techniques of a domestic development scheme through the
formal Planning Process.
Just like the re-wording of the 2008 Permitted Development Rights legislation that created havoc for most
Councils, homeowners, neighbours and Building Designers alike, there is scope to minimise the tax applicable
to this piece of 'ill thought out taxation' on the already battered construction industry.
In fact, it is my personal view is that this new building tax is so aggressive and punitive for the
domestic homeowner that if it was implemented in any other non-organised culture or society it would
probably be considered as blackmail or extortion run by the underworld.
Here at CHP we have analysed the wording of the new CIL tax and we have devised a few strategies and
techniques of minimising your exposure to this new CIL tax or even completely avoiding it for
many home extensions that are over 100 square metres.
Just like accountancy, these techniques and strategies will have to be tested over the next year or
two as each Council adopts the levy and chooses how to interpret the new charging regime - not all Local
planning Authorities will think the same way - just like the Permitted Development legislation we have today.
If you have an extension scheme of over 100M2 and wish to minimise or avoid paying £15,000.00 tax to
vanish into some Council central pot to fund some hair brained academics idea of traffic calming
or subsidised bus travel for the great unwashed or some extra portacabins for the failing local school then do
give us a call.
Quote of the day....
"Nothing will ever be attempted if all possible objections must first be overcome"