Cheltenham CIL appeal quashes surcharges over start date

A Cheltenham CIL appeal has succeeded after an Inspector found that the chargeable development had not actually commenced, wiping out the council’s deemed commencement date and the surcharges tied to it.

Appeal APP/B1605/L/25/3369138 concerned a property where an earlier outbuilding had been built differently from its original approval and was being used with a gym, sauna, living space and a first-floor apartment. A later appeal permission authorised a different prospective residential development, but Cheltenham Borough Council treated the date of that permission as the deemed commencement date for Community Infrastructure Levy purposes.

Inspector M Madge rejected that approach. The later permission did not retrospectively regularise the building as it stood. Because the development actually granted on appeal had not begun, the Inspector found that the deemed commencement date was wrong and that the associated surcharges could not stand.

Why the Cheltenham CIL appeal succeeded

The dispute turned on a deceptively simple question: had the development covered by the relevant planning permission actually commenced?

The property had a complicated planning history. An earlier permission allowed a detached garage with ancillary accommodation and storage. The building that was eventually erected was wider and taller than approved and incorporated a self-contained two-bedroom apartment which had been used for short-term letting. Enforcement notices were served and later withdrawn.

A subsequent appeal then granted planning permission for a different development. Crucially, that permission was framed prospectively. The Inspector who granted it imposed a three-year time limit for commencement and did not describe the decision as authorising retention of the building already on the land.

That distinction became central to the CIL appeal. Cheltenham had issued a liability notice and demand notice on 12th June 2025, identifying 6th June 2025, the date of the earlier appeal decision, as the deemed commencement date.

But a planning permission being granted is not the same thing as the development permitted by it having commenced.

The existing building was not the development that had been permitted

During the site visit, the CIL Inspector found that the building did not match the approved internal arrangement. Instead, the ground floor contained a gym, shower and sauna room and a multi-purpose living space with a kitchen, while the first floor contained a self-contained two-bedroom apartment.

The Inspector’s conclusion was direct: this was not the development granted permission on appeal.

The council had argued that the later planning permission effectively retained the building as it stood and should be treated as a retrospective permission under section 73A of the Town and Country Planning Act 1990. The Inspector disagreed.

The earlier appeal decision had expressly dealt with a prospective proposal. Its description and conditions did not authorise the existing building regardless of how it was being used. The permission would only take effect once the approved development was actually begun.

That is an important distinction for anyone dealing with Community Infrastructure Levy. CIL liability can turn on the precise permission, the development it authorises and the date on which that development legally commences. A superficially similar building already standing on the land does not necessarily answer that question.

Permission wording mattered more than the planning history

The decision also reinforces the importance of reading the permission itself rather than attempting to reconstruct what the parties may have intended from the wider history.

The Inspector referred to the established approach that a planning permission is construed primarily from the permission and the plans expressly incorporated into it. There is a strong public interest in parties being able to rely on the face of the permission without having to investigate every earlier document.

That mattered here because the council’s CIL case depended on treating the later permission as though it had retrospectively authorised what was already on the site. The permission did not say that.

The Inspector also referred to the principle that even where section 73A is involved, it does not automatically make an existing building lawful for any use. The permission still has to be read as a whole, including any conditions and the development actually authorised.

On the facts, the approved standalone residential use had not commenced. The Inspector therefore found that “the chargeable development has not been commenced”.

Wrong commencement date brought down the demand notice

The appeal under regulation 118 of the Community Infrastructure Levy Regulations 2010 challenged the deemed commencement date in the demand notice.

Once the Inspector found that the chargeable development had not commenced, the date of 6th June 2025 could not stand. The regulation 118 appeal therefore succeeded.

That had an immediate consequence. Demand notices issued before a successful regulation 118 appeal cease to have effect. Ordinarily, the appointed person would then determine a revised commencement date.

Here that was impossible. The development had not commenced and there was no evidence establishing an intended future commencement date. The Inspector therefore said it was for the council to withdraw the existing demand notice and issue another one when a proper intended or deemed commencement date could be identified.

This is a useful reminder that a CIL demand notice is not insulated from challenge simply because a liability notice has already been served. The commencement date is a separate and potentially decisive part of the machinery.

CIL surcharges were also quashed

The decision then dealt with the surcharges imposed for failing to assume liability and failing to submit a commencement notice.

Those penalties depended on the chargeable development having reached the point where the relevant procedural steps should already have been taken. Once the Inspector found that commencement had not occurred, that premise fell away.

An assumption of liability notice could still be submitted before commencement. A commencement notice could likewise still be submitted no later than the day before the development begins.

The Inspector therefore found that there had been no failure of the kind required to support the surcharges. The appeal under regulation 117(1)(a) succeeded and the surcharges were quashed.

For developers and owners, that is the practical heart of the decision. The consequences of a wrong commencement date can cascade through a CIL case. It can affect not only the demand notice but also whether procedural defaults and surcharges have actually arisen.

One ground of the CIL appeal still failed

The appellant did not win everything. A separate ground argued that the liability notice had not been issued before the demand notice.

The Inspector rejected that point because the CIL Regulations do not require a liability notice to be issued in advance of a demand notice in every case.

The appeal under regulation 117(1)(b) was therefore dismissed. The formal outcome was mixed: the commencement-date challenge succeeded, the surcharges were quashed, but the liability-notice ground failed.

That nuance matters because it would be misleading to report the decision simply as a blanket cancellation of CIL liability. The Inspector did not decide that no CIL could ever become payable. Instead, the existing demand was based on the wrong commencement premise and had to fall.

What practitioners should take from appeal 3369138

The strongest lesson from the Cheltenham CIL appeal is that commencement has to relate to the development actually authorised by the relevant permission.

A building already on site, even one with a complicated enforcement history, does not automatically mean a later permission has commenced. Equally, the date a permission is granted is not itself a commencement date.

Before accepting a demand notice, check the permission description, approved plans, conditions and what has physically happened on the land. Those details can change the entire CIL position.

The decision is also a reminder to separate the different CIL appeal grounds. A commencement-date challenge, surcharge challenge and liability-notice challenge each have their own tests. Winning one does not necessarily mean winning them all.

The full decision can be checked on the locally hosted appeal decision and through the Planning Inspectorate appeal record.