CIL Surcharge: Penalties, Interest and Missed Forms

 

A CIL surcharge is an extra amount which a collecting authority can add when the Community Infrastructure Levy procedure is not followed. Different mistakes carry different surcharges, and late payment can add both a surcharge and separate interest.

This page explains the penalties themselves. If the problem has moved on to a stop notice, liability order or debt recovery, see our CIL enforcement guide. If you want to challenge a surcharge already imposed, our CIL appeals guide explains the appeal procedure.

 

When can a CIL surcharge be imposed?

 

Part 9 of the CIL Regulations contains several separate surcharges. They do not all depend on the same mistake, and some are discretionary while others are mandatory in particular circumstances.

The main surcharges in England are:

• £50 where development has commenced and nobody has assumed liability, imposed on each person liable under regulation 80
• £500 on each owner where the authority has to apportion liability between material interests under regulation 81
• 20% of the chargeable amount, capped at £2,500, for failing to submit a required Notice of Chargeable Development under regulation 82
• A commencement-notice surcharge under regulation 83, normally 20% of the relevant chargeable amount capped at £2,500
• 20% of the chargeable amount, capped at £2,500, for failing to notify a disqualifying event within 14 days under regulation 84
• Late-payment surcharges under regulation 85
• 20% of the relevant amount, capped at £1,000, for failing to comply with an information notice within 14 days under regulation 86

A development can attract more than one of these. Paying one surcharge does not undo the underlying CIL liability or prevent a different surcharge arising from another failure.

 

Starting without assuming liability

 

Before commencement, a person can formally assume liability to pay CIL. If development starts and nobody has done so, regulation 80 allows the collecting authority to impose a £50 surcharge on each person who is liable to pay CIL.

Where the authority then has to work out how liability should be divided between different material interests in the land, regulation 81 allows a further £500 surcharge on each owner.

These amounts may look modest compared with the underlying levy, but the more serious consequence is that the normal payment and instalment position may also change once the procedure has gone wrong.

 

Missing a Notice of Chargeable Development

 

Permitted development and other general consents can still be liable to CIL. Where a Notice of Chargeable Development is required under regulation 64 and is not submitted, the collecting authority can impose the regulation 82 surcharge.

The surcharge is 20% of the chargeable amount or £2,500, whichever is lower.

This is one reason permitted development should never be treated as automatically outside CIL. Our CIL forms guide explains Form 5 and the other notices.

 

Missing the Commencement Notice

 

Regulation 83 has an important distinction. In the ordinary case, where development starts before a valid Commencement Notice has been received, the authority may impose a surcharge equal to 20% of the chargeable amount or £2,500, whichever is lower.

Since the 2019 amendments, a different rule applies where specified relief or exemption has already been granted. For a residential annexe, self-build housing, charitable relief or social housing relief, the authority must normally impose 20% of the notional chargeable amount, capped at £2,500, rather than automatically cancelling the relief. The authority need not impose it where the surcharge would be less than the reasonable administrative cost of dealing with it.

That protection only helps where the relief or exemption was already granted. Starting before the claim itself has been made and granted can create a much more serious problem.

 

Failing to report a disqualifying event

 

Some CIL reliefs and exemptions have clawback rules. Where a disqualifying event occurs, the Regulations require the person concerned to notify the collecting authority within 14 days.

Failure to do so can attract a regulation 84 surcharge equal to 20% of the chargeable amount or £2,500, whichever is lower. That surcharge sits on top of the CIL which becomes payable because the relief or exemption has been withdrawn.

 

Late payment can produce three separate surcharges

 

Regulation 85 uses a staged system.

• After 30 days from the payment due date, the authority may impose 5% of the full amount due or £200, whichever is greater
• After six months, if any part remains unpaid, it may impose a further 5% of the unpaid amount or £200, whichever is greater
• After 12 months, if any part remains unpaid, it may impose another 5% of the unpaid amount or £200, whichever is greater

The first stage therefore looks at the amount which was due, while the later stages look at the balance still unpaid.

Do not assume that a later revised Demand Notice wipes away a late-payment surcharge which has already arisen. In London Borough of Lambeth v Secretary of State for Housing, Communities and Local Government; Thornton Park (London) Ltd [2021] EWHC 1459 (Admin), the High Court held that a revised notice did not erase CIL, surcharge or interest which had already accrued. A revised notice is not a way to reset the payment clock.

 

Late-payment interest is separate

 

Interest under regulation 87 is not the same thing as a regulation 85 surcharge. It runs from the day after payment was due until the unpaid amount is received.

The rate is 2.5 percentage points above the Bank of England base rate. The Regulations do not apply interest on the interest itself.

Because the base rate can change, the interest figure is not fixed for the whole life of a CIL debt.

 

Information notices can carry their own surcharge

 

A collecting authority can use an information notice under regulation 86 to obtain information needed for CIL. If the recipient fails to comply within 14 days, the authority may impose a surcharge equal to 20% of the relevant amount or £1,000, whichever is lower.

This is separate from the powers used later to recover an unpaid debt.

 

Relief does not always protect you from procedural penalties

 

R (Heronslea (Bushey 4) Ltd) v Secretary of State for Housing, Communities and Local Government [2022] EWHC 96 (Admin) arose from a development which had received social housing relief but failed to submit the required Commencement Notice before starting. The case concerned the resulting CIL and late-payment surcharges under the rules then being applied.

The Regulations were amended in England in 2019 so that a missed Commencement Notice after specified relief has already been granted now operates through the notional-charge surcharge in regulation 83 rather than automatic loss of the relief. The case remains a useful illustration of how quickly procedural failure can become an expensive CIL dispute, but the current regulation 83 must be used for developments governed by the amended regime.

 

How to appeal a CIL surcharge

 

A regulation 117 surcharge appeal goes to the Planning Inspectorate. It must be made within 28 days beginning with the day the surcharge was imposed.

There are only three statutory grounds:

• The claimed breach which led to the surcharge did not occur
• The collecting authority did not serve a Liability Notice for the chargeable development to which the surcharge relates
• The surcharge was calculated incorrectly

The surcharge is not payable while a valid appeal against it is outstanding. This appeal does not provide a general power to waive a correctly imposed surcharge because the result feels harsh.

See our CIL appeals guide for the procedure and the other CIL appeal routes.

 

What if the underlying planning permission is refused?

 

A CIL surcharge only arises within the CIL regime. If the underlying planning application is refused, the planning decision is challenged separately through the normal planning appeal route where an appeal is available.

Planning application fees are also separate from CIL and its surcharges. See our planning application fees guide.

 

Relevant CIL surcharge rules

 

• Regulations 80 to 88: CIL surcharges and interest
• Regulation 83: missing Commencement Notice
• Regulation 85: late-payment surcharge
• Regulation 87: late-payment interest
• Regulation 117: surcharge appeal

Community Infrastructure Levy (CIL)

 

CIL Surcharge Page Created: 30th August 2026