Will You Pay CIL on a London Extension?

What CIL is

The Community Infrastructure Levy (CIL) is a charge some councils levy on new development to help fund local infrastructure. It is charged per square metre of new floorspace, at rates set locally. Crucially, CIL only applies where the local authority has adopted and published a CIL charging schedule — not every area charges it, and rates vary widely between those that do. In London, the Mayor also charges a CIL to help fund the Elizabeth line, on top of any borough CIL.

The 100 square metre rule

The single most useful figure is 100 square metres. New development that creates less than 100 square metres of gross internal floorspace is generally exempt from CIL as minor development. Most single-storey rear or side extensions, and many loft conversions, fall under this threshold and are outside CIL for that reason alone.

There is one important exception: if the development creates a new dwelling, it is liable for CIL even if it is under 100 square metres. So a small new-build house, an annex that counts as a separate dwelling, or a conversion that creates an additional unit can be caught where an extension of the same size would not be.

The exemptions — and the catch

Larger home projects are not automatically charged. There are specific exemptions: a residential extension exemption, for enlarging your own principal home without creating a new dwelling; a residential annex exemption, for an annex within the curtilage of your home; and a self-build exemption, for a new home you build for yourself to live in. Together these mean most genuine homeowner projects need not pay CIL.

The catch is procedural, and it is where people get caught out. You have to apply for the exemption and have it granted before development commences: start on site before the exemption is in place and you can lose it entirely, turning a nil bill into a real one. Separately, you must assume liability and submit a commencement notice before you begin — and starting without that notice triggers a surcharge equal to 20% of the notional chargeable amount, capped at £2,500. The annex and self-build exemptions also carry a three-year clawback if the property is let or sold separately within that time.

What to do about it

The practical takeaway is simple: find out early whether your borough charges CIL and whether your project crosses the 100 square metre or new-dwelling lines, and if an exemption applies, claim it and serve the commencement notice before a single day of work starts. Because CIL is administered through the planning process, it is best handled alongside the planning application rather than discovered afterwards. The exact position depends on your borough’s charging schedule and your specific scheme.