Community infrastructure levy
The community infrastructure levy is a new levy that local authorities in England and Wales can choose to charge on new developments in their area. Our overview document provides a quick guide to the levy. The levy is designed to be fairer, faster and more transparent than the previous system of agreeing planning obligations between local councils and developers under section 106 of the Town and Country Planning Act 1990.
In areas where a community infrastructure levy is in force, land owners and developers must pay the levy to the local council.
The charges are set by the local council, based on the size and type of the new development.
The money raised from the community infrastructure levy can be used to support development by funding infrastructure that the council, local community and neighbourhoods want, like new or safer road schemes, park improvements or a new health centre.
The community infrastructure levy:
- gives local authorities the freedom to set their own priorities for what the money should be spent on
- gives local authorities a predictable funding stream that allows them to plan ahead more effectively
- gives developers much more certainty from the start about how much money they will be expected to contribute
- makes the system more transparent for local people, as local authorities have to report what they have spent the levy on each year
- rewards communities receiving new development through the direct allocation of a proportion (15% or 25% depending on whether a Neighbourhood Plan is in place) of levy funds collected in their area
Guidance setting out the main procedures local authorities need to follow when introducing and operating the community infrastructure levy was published in April 2013.
Community infrastructure levy regulations and amendment regulations
The Community Infrastructure Levy Regulations 2010 came into force on 6 April 2010.
The Community Infrastructure Levy (Amendment) Regulations 2011 came into force on 6 April 2011.
The Local Authorities (Contracting Out of Community Infrastructure Levy Functions) Order 2011 came into force on 7 December 2011.
The Community Infrastructure Levy (Amendment) Regulations 2012 came into force on 29 November 2012.
The Community Infrastructure Levy (Amendment) Regulations 2013 came into force on 25 April 2013.