GPDO

General Permitted Development Order

Article 4s Blocked HMOs Legislation Compensation

Article 4 Compensation – when can you claim?

Compensation? When a local authority brings in an Article 4, you may be entitled to compensation. This is not widely publicised for obvious reasons!

However in certain circumstances, this might be a right for you to claim. This might impact commercial or residential owners who are impacted by a new Article 4.

Importantly you can not claim compensation if the local authority has given at least 12 months and less than 24 months notice of the Article 4 coming into effect. These are called non-immediate Article 4 Directions.

However where a local authority (LPA) introduces an Immediate Article 4 direction, or gives less than 12 months notice, you might be able to claim compensation. You are encouraged to read the full page here and refer to any legislation. 

Compensation – what are the facts to claim?

A claim must be made on an application submitted within 12 months of the immediate Article 4 coming into effect. For HMOs, you can see this date here.

So take London Borough of Ealing as an example. They announced two Article 4s. 

An immediate one which came into effect on 30th October 2024 and a non-immediate Article 4 to come into effect in November 2025.

There is no option to claim against the non-immediate Article 4 as enough notice has been given. However the immediate one in the Perivale area could be subject to claims on applications submitted until 29th October 2025. You then have time to make a claim.

In the case in Perivale a claim may arise if a planning application is refused, which would otherwise be granted as permitted development under Class L of Part 3 of the GPDO or planning permission is granted and is subject to more restrictive conditions that would have otherwise been the case under permitted development (Class L of Part 3 in this case). The same would apply to any other area removing Class L rights for HMOs with immediate effect. 

Importantly you must make a planning application, within 12 months of the immediate Article 4 coming into effect.

A claim for compensation must be made in writing to the local authority and must be served within 12 months of the refusal or restricted approval. Any person having an interest in the land or property, whether that is a freeholder or leaseholder can claim compensation. 

The claim can include:

• abortive expenditure – this could be preparatory work carried out to the property with exercising the permitted development right in mind, and professional fees, plans, reports etc.
• other loss or damage directly attributable to the withdrawal of the permitted right – this can include the difference in the value of the land, e.g. if the development had been carried out under the permitted development right and this resulted in an uplift in the land value
• a reduction in profit in carrying out the smaller development – for example running the property as a single let as opposed to an HMO
• the cost in complying with conditions. Maybe providing bike stores, where these would not be required under permitted development for example

Claims would be made to the local authority and if not agreed, would be determined by the Upper Tribunal of the Land Chamber. The claimant would need to show a loss made as a direct result of the Article 4.

Purchasing the site after the Article 4 came in might not work. But I guess as long as you comply with the legislation…….

All expenses to be claimed must be evidenced. 

These compensation claims can apply to many types of both residential and commercial development  – see below.

Which permitted development rights are subject to compensation?

The following Classes are deemed as prescribed development as far as legislation is concerned (see legislation section below as well)

(a) Part 1 (development within the curtilage of a dwellinghouse);
(b) Classes D, E and G of Part 2 (certain minor operations);
(c) Classes A, AA, C, D, G, J, I, K, JA, L, M, MA, N, O, P, PA, Q, R, S, T and U of Part 3 (certain changes of use);
(d) Classes B, BB, BC, C, CA, D and E of Part 4 (temporary uses);
(da) Classes A and B of Part 6 (agricultural and forestry);
(e) Classes A to H, L, M, MA and N of Part 7 (non-domestic extensions, alterations etc);
(ea) Class B of Part 11 in so far as it relates to a development mentioned in paragraph B.1(d) (demolition of concert halls, venues for live music performance and theatres);
(eb) Class BA of Part 12 (holding of a market by or on behalf of a local authority);
(f) Part 14 (installation of renewable energy equipment);
(g) Class A of Part 16 (development by electronic communications code operators) to the extent that paragraph A.2(5) of Class A disapplies certain conditions in paragraph A.3 of Class A.;
(ga) Class TA of Part 19 (development by the Crown on a closed defence site); and (h) Part 20 (construction of new dwellinghouses); and
(h) Part 20 (construction of new dwellinghouses).

It also applies to permission in principle applications as well. 

Legislation

This is defined in Section 107 of the Town & Country Planning Act 1990 (as amended) and Section 108 of the Town & Country Planning Act 1990 (as amended) and finally the Town and Country Planning (Compensation) (England) Regulations 2015

Note that the information on this page is our interpretation of the legislation and is subject to errors. You will need to apply in accordance with the legislation above. Legislation is also updated, so please ensure that you are reading the latest version.

Always check to ensure that our understanding of the legislation is correct. We can’t be held responsible for any typos or mistakes. 

Article 4 compensation – Page updated 24th May 2025