It is not uncommon, particularly for larger developments, for an outline planning consent to be obtained and for details such as layout, landscaping, access arrangements, visual appearance and scale to be reserved for a later application.
Community Infrastructure Levy (CIL) is charged on the creation of new floorspace at the rates shown on the charging schedule adopted by the local planning authority (LPA) which, in CIL charging areas, is also the charging authority for CIL (CA). The purpose of the charging schedule is to reflect the reasonable cost of providing the infrastructure required to service the proposed new development. The rates on the adopted charging schedule are updated each calendar year by an indexation figure that is published by the Royal Institution of Chartered Surveyors (RICS) on 1 November in the previous year. The indexation figure reflects the annual change in infrastructure costs as monitored by the RICS. By way of example, Teignbridge District Council (TDC) adopted a charging schedule in July 2014 in which the CIL charge for new residential floorspace in rural areas was £200 per sq. metre. Since 2014, the RICS indexation figure has increased from 239 in 2015 to 400 in 2026 – an increase of 67.36% – which means that the TDC CIL charge for new residential floorspace in rural areas is now £334.73 per sq. metre. The average rate of increase year on year has been 4.43% but there are marked variations between individual years ranging from a 9.79% increase to a 0.30% decrease.
The change in the CIL charging rate between different years arising from the RICS indexation adjustment was the key issue in a recent CIL appeal. As usual, the appeal decision is heavily redacted and we do not know the location of the development. However, the LPA had granted outline planning consent for up to 46 residential dwellings and had then subsequently granted a reserved matters approval in respect of the details, which included the area of new residential floorspace to be created. As the CA, it had issued a CIL charging notice which calculated the amount of CIL payable by multiplying the new floorspace to be created by the indexed CIL rate for the year that the reserved matters consent was granted. The appeal decision is dated March 2026. It is therefore reasonable to assume that the reserved matters consent was granted in 2025 and the outline planning consent in 2023. If that were the case, the RICS index figure was 355 in 2023 and 391 in 2025 which is an increase of 10.14%. On the assumption that the average size of each dwelling is 120 sq. metres, the development will potentially create 5,520 sq. metres of chargeable development and a 10% difference in the CIL charging rate is therefore significant.
In the CIL appeal, the CA argued that it is only when the reserved matters application was granted that it could calculate the chargeable area and the approved development was capable of going ahead and that, as the purpose of the CIL charge is to cover the cost of providing the infrastructure necessary to service the approved development, it was correct for it to apply the CIL charging rate for the year that the reserved matters application was granted.
The developer/appellant argued that Regulation 40 of The Community Infrastructure Levy Regulations 2010 states that the amount of CIL chargeable at a given relevant rate must be calculated by applying the indexation adjusted rate for the year in which planning permission was granted. Regulation 5 of the Regulations defines “planning permission” as planning permission granted by a LPA under section 70, 73 or 73A of Town and Country Planning Act 1990 (TCPA). Outline planning consents are granted under section 70 of the TCPA but none of those sections apply to reserved matters applications which, in themselves, are not the grant of a separate planning consent but relate solely to the outline consent already granted – see our 2019 article here. The developer said that the wording of the Regulations is clear and unambiguous and that the CA’s approach was incorrect as a matter of law.
The Valuation Office appointed person (AP) agreed with the developer and upheld the appeal. It would be prudent for any of our readers who have been issued with a CIL liability notice in similar circumstances to check that their CA is using the CIL rate that was correct as at the date of the grant of the outline consent.
In CIL appeals, the AP has a discretionary power to make orders as to costs. However, that discretion must be exercised sparingly and only where a party has acted unreasonably, such that the other party has been put to unnecessary expense. The developer had obtained several legal opinions and provided a CIL appeal decision that had confirmed that the CA’s methodology was unlawful and provided those to the CA. The developer argued that, in ignoring those opinions and the other appeal decision and continuing to act unlawfully, the CA had acted unreasonably and put the developer to the unnecessary expense of the appeal. The CA said that it acted reasonably in advancing and defending its position on what it called a live and material issue of statutory interpretation. In this case, the AP accepted the CA’s submissions and dismissed the application for costs. It is not difficult to see that, in a different forum or with a more rigorous approach to the expectation that a CA should correctly apply the statutory provisions of the CIL Regulations, the developer’s application for costs may have been successful.
