For many years, property developments have potentially been subject to two taxes levied by local authorities as part of the planning process – Planning Application fees and Building Regulations fees.
Since 2010, local authorities have been allowed to charge a third tax, the Community Infrastructure Levy, on new property developments and extensions in excess of 100 square metres.
It has been left up to each local authority to decide whether to introduce a Community Infrastructure Levy, the type of property to which it will apply and the rate to be charged. Details are expected to be announced over the course of 2013.
Due to the discretion given to local authorities, the rates of Community Infrastructure Levy may vary substantially from place to place.
A window of opportunity exists in those areas where the Levy has not yet been introduced to avoid liability if planning permission can be obtained before the levy comes into effect.