Invalidating self build CIL exemption

[eski009]

Hi all,

 

I’m in the process of building a new home for my family. 
 

Planning permission was granted for a two-storey house and the build commenced 5 months ago. 
 

We have just decided that we want to go bigger and add a basement underneath the patio that is on sloped land so will open up on to the garden.

 

I have been advised that this will require a full planning application and could put our CIL exemption at risk as the CIL is attached to a planning application and CIL exemption requires that building hasn’t yet commenced. 
 

Has anyone got any advice on what to do?

 

Thank you. 

[Johnnyt]

My understanding is. providing you got whole house exemption, the CIL becomes payable if you do not send in form 7 part 2 within 6 months of the completion cert issued.

 

In our case, after commencement, we decided to go for a much larger garage which we did by means of a new application.

I notified the planning obligation dept at the LPA and they indicated ok to proceed.

I have yet to get a completion certificate, the LPA have chased this but I just said my builder is unobtainable and so I am unable to go for sign of as yet.

The LPA are fine with this but will periodically remind me.

 

[nod]

If the home is going to be your main residence and you don’t sell with in three years of completion cert

You will be fine 

 

Speaking our cil administrator They are busy chasing developers with multiple properties that are trying to get round paying there cils 

 

[Alan Ambrose]

@eski009 - btw as a newbie to the forum, just so you know - the forum etiquette is that if you ask a question and people take time and energy responding, then you implicitly agree to consider the replies, and reply yourself etc. I'm not singling you out, just saying that there are some people who alight on Buildhub for the first time, ask a question, people reply - sometimes at length ... and we never hear from the original questioner again.

 

 

OK I think you might have a snag - I've come across this myself. Like other UK tax laws, the CIL law ( https://www.legislation.gov.uk/uksi/2010/948/contents ) is very fragile, which means if you put a foot out of step, even accidentally, you get nailed. Fair? No. I also think that the CIL law is 'interpreted' by your local LPA - so not all LPAs read or implement CIL the same way. Also, I don't think there are many experts on CIL - I had a commercial property lawyer (read 'grown up') for my plot and she sad 'we cannot advise on CIL'. I don't think she realised that it was even part of the planning legislation.

 

I have not read the legislation (yet) but I had this interaction with my local LPA's CIL department last summer. As the plot had planning already, I asked whether I could put in my services, driveway etc based on the old permission while I was waiting on them to decide on my new permission:

 

"We would like to start getting the services and access arrangements started on this plot. The applications listed above are for the same single dwelling plot, a ‘greenfield plot’ located at xxx yyy. Planning was granted for a single storey dwelling under zzz back in November 2021. We have since proposed two variations in design for LPA consideration and these are still waiting for decisions - which we are told will be forthcoming over the next week or so. We have been told that the single storey design will be granted and the 1.5 storey design refused. We intend to take the latter to appeal. This is a self-build. The access arrangements, cart lodge etc are the same in both of the outstanding designs – it’s just the dwelling itself that varies.

 

As we already have planning granted for a single storey dwelling, we would like to make a start on the installation of services and for the driveway for access.

 

I imagine that we can simply signal a formal start under the original application and then ‘move the CIL arrangements’ as the new planning and/or appeal comes through.

 

Would that be correct? If so, what is the correct procedure for ‘moving the CIL arrangements’?"

 

They answered:

 

"If your new applications were variations of the original consent, it would be possible to transfer a self build exemption across, however, as you have made new full applications this becomes somewhat more complicated. You cannot transfer a self build exemption from one full application to another. If you make a start and carry out a material operation to commence development, you could invalidate any possibility of claiming exemption on an alternative permission. Given the access arrangements are the same, you would effectively have already implemented a new permission on the day permission was granted and the CIL for it would be payable in full, immediately. I would recommend you wait to implement any permission until you have received the permission you intend to build out to avoid any potential issues down the line."

 

This agrees with the response you got, although I imagine your local LPA CIL guys do have some flexibility. That said, they are a revenue raising team, so guess what - they probably love the fragility of their interpretation of the CIL law.

 

 

So I suggest, a possible way around is to try to vary your original application (there are various mechanisms for that) so it's not a new application, just a variation of the old. That might mean some compromises in you design - maybe so it looks the same as the old to the casual observer, even though you have a basement now. If your variation gets turned down, you still have the original application intact. This assumes you have a bit of time to wait for the LPA's response. They may still refuse to vary based on the fact that it's an increase in floor area. But they may not.

 

I found my local CIL guys a lot more approachable that the planning guys, so maybe you could get a face-to-face to see what they might allow or whether they might give you an exemption so you just pay the uplift for the extra floor space. They might decide it's a question for the planning guys and send you there or might take the question to the planning guys themselves. If you are a risk taker and have a good lawyer and the CIL law supports your position then you might also ignore their response, and be prepared to fight in the courts later.

 

Do let us know what happens - I for one am still interested in this question. Also it builds the level of Buildhub knowledge.

 

 

 

 

 

 

[eski009]

Alan, Bob and Johnny - thank you for your considered responses. 
 

Alan - your response in particular was very helpful. Unfortunately, as the description is changing, I’ve been advised that a new full application would be required. 
 

Work wouldn’t commence on the amendment until permission was granted though. The question is whether  we would have to re-request CIL exemption and whether we would qualify as technically the build had already started for the amended application.

 

I’m sharing this thread with my architect and will also try and speak to the council. 

[Alan Ambrose]

>>> the description is changing, I’ve been advised that a new full application would be required. 

 

You can write pretty much put whatever you like for the description of a planning application. I suggest asking your architect whether you really need to submit a full application or whether it could be a variation of the old - possibly even accepting constraints on the basement design to make it a variation only. This could be important and may be the difference between paying CIL or not. I'm assuming you are looking at a non-trivial CIL amount. Mine is £40-60K atm depending which design I'm looking at - and that's excluding the basement floor area which will another 1/3rd to the CIL amount. I don't know whether we will definitely have a basement until I see the soil investigation results. Note that the reasoning for you to do a  variation rather than a full application is solely because of the CIL impact - otherwise you might not care.

 

I think we are in the exact same position except that I have asked ahead of time:

 

+ this is, there is existing planning on my plot and I would like to use that to get the services in while I'm waiting for the approval to come through for my new design. My CIL people are saying 'if you do that, you will invalidate your self-build exception and have to pay the CIL'.

 

+ you have already started on your build and want to substantially modify the design such that you might need to submit a new full application. Presumably you have sent in the CIL liability and self-build exemption forms. So, if my local CIL people are right, you would also invalidate your self-build exemption .

 

I'll see if I can find the reasoning for their logic in the CIL 2010 Regulations when I get a few hours and determine (a) whether they're right and (b) if there's a workaround.

 

You might check with your local CIL people, if you have not done so already, as they have some discretion. Yours may be more sensible than mine. 

 

 

 

 

 

 

Edited January 8 by Alan Ambrose

[Temp]

The CIL legislation leaves a number of grey areas that can only really be resolved by the courts. I recommend trying to find a near identical court case otherwise I think there is a very real risk you would loose the exemption.

[Haylingbilly]

I would tread very carefully on this one and before you apply for planning permission would get in writing from the CIL team your proposed approach will work. I believe any retrospective applications will invalidate the exemption, with regard to variations - if it is materials /finishes etc then I think you are ok, but increasing the footprint then no you aren't. I had issues with mine and hired a specialist lawyer who had a diferent opinion on commencing development to that from the CIL team!!

[torre]

This sounds like something you could address with a section 73 application, assuming there's a condition along the lines of being built according to approved plans.

 

Does the description really need to change? I assume it's along the lines of 'a dwelling house ...' - some have basements, some don't.

 

Section 73 has been interpreted pretty broadly recently  in favour of changes that sound more substantial than you're aiming for.

 

(I'd echo that a new full application after commencement puts your CIL at risk)

 

 

[Alan Ambrose]

FYI more CIL appeals than I expected:

 

https://www.gov.uk/government/collections/community-infrastructure-levy-appeal-decisions

 

At least they're all listed in one place. Annoying that they're redacted - it makes them significantly harder to read. Standard planning appeal decisions are not redacted.

 

As a (not very encouraging) example, this one, for instance, finds a technicality in favour of the LPA to invalidate a self-build exemption. Total BS if you ask me and against the intent of the self-build exemption - but consistent with CIL as a revenue raising activity and a fragile tax law laying in wait to trap the unwary:

 

https://assets.publishing.service.gov.uk/media/64d5ec095cac650014c2ddaf/CIL_Appeal_1801243_26_Sep_22.pdf

 

BTW CIL appeals seem to follow a totally different system to standard planning appeals.

 

Nope, spoke to soon ... another list from the standard appeals portal:

 

CIL Appeals.pdf

 

I have not tried to reconcile the two lists...

 

Also this:

 

https://www.irwinmitchell.com/news-and-insights/expert-comment/post/102fdgq/the-famous-five-a-quickish-recap-of-case-law-on-the-operation-of-the-community

 

Presumably there's an extended bunch of court decisions too for those taken beyond the appeal stage.

 

@Haylingbilly - possible to share your CIL lawyer's details - I can't imagine there are many of them around.

 

Edited January 9 by Alan Ambrose

[kandgmitchell]

On 08/01/2024 at 14:22, torre said:

This sounds like something you could address with a section 73 application, assuming there's a condition along the lines of being built according to approved plans.

 

Does the description really need to change? I assume it's along the lines of 'a dwelling house ...' - some have basements, some don't.

 

Section 73 has been interpreted pretty broadly recently  in favour of changes that sound more substantial than you're aiming for.

 

(I'd echo that a new full application after commencement puts your CIL at risk)

 

 

I'd second this as an approach. It may be useful to share the exact description of work on the original approval. Presumably there is a condition stating you must build as per plans reference...... So it may be that all(!) is required is an application to vary that condition so as to accept amended plans showing a basement. 

 

A particular court case: Vue Entertainment v City of York Council may illustrate this. The original approval for a leaisure development included a "multi-screen cinema" and one condition was that the cinema was to have 12 screens and 2000 total capacity. An application to vary that condition to a 13 screen 2,400 capacity, originally refused, was eventually found lawful by the High Court because the original approval description was not being changed by the Section 73 application (which cannot be done) as it had simply said "multi-screen cinema" on said approval.

 

In a similar way I had to revise a warehouse approval because preparation works on site found a previously unknown 400mm water main (??). The building had to be shortened by 3m. This was dealt with by applying to vary the condition requiring the scheme to be built to the specified approved plans and substituting revised drawings showing the alterations, as the original description of warehouse hadn't changed.

 

Would this not avoid any CIL issues whilst confirming your basement is lawful ( again on the assumption that the approval doesn't say "dwelling house of x square metres floor area etc").