JUST three out of 10 appeals to the Planning Inspectorate about a “convoluted” levy on property development are successful, according to research from a Southampton business.

Property tax specialist E3 Consulting analysed every Planning Inspectorate judgement about the Community Infrastructure Levy (CIL) from January 2020 to July 2021.

The levy applies to developers who win planning permission and goes towards infrastructure such as roads, parks and GP surgeries.

Unlike the ‘Section 106’ agreements which it replaced, the levy is not negotiable and is set by the local council granting permission.

Any exemption or relief – including for self-builders and developments under 100sqm – must be gained before work starts. E3 Consulting says this means many who would have been exempt miss out or incur penalties if they begin work without the paperwork in place.

E3’s managing director, Alun Oliver, said: “The 70 per cent failure rate uncovered in our findings is indicative of just how convoluted and confusing CIL is for many people.

“CIL is highly-procedural and over-complex, and a lack of understanding leads to time consuming and costly appeals which are largely doomed to failure.

“The process is very time sensitive but sadly a lot of situations lead to costly errors and for the vast majority of those costly errors, the opportunity for relief is lost forever.

“Once a spade has hit the ground and work has started on site it is incredibly difficult to gain any exemption or relief from the CIL charge or win a subsequent appeal. Often an appeal is a result of an emotional response to the perceived unfairness of CIL, as it is seemingly a heavy price to pay for relatively small administrative mistakes.

“This response is common, however not useful, as retrospective action in CIL is fruitless and time-consuming.

“Developers and homeowners must be proactive from the very start with CIL or may rue the day they chose to put off dealing with CIL.”

The most common development type affected by the levy is residential, but many councils also apply it to other forms of property, including halls of residence, hotels, retail and offices.

It is a charge calculated per square metre of floorspace and applies to new developments exceeding 100sqm or creating one or more new dwellings – meaning many homeowners building extensions should be exempt as well as people building their own home.

The exemptions are not automatic and must be applied for before work begins.

E3 conducted its own set of research based on CIL Planning Inspectorate appeals on GOV.uk webpage.

Some 38 per cent of cases involved disputes over the start date of works. Overall, the majority of appeals – 39 out of 65 cases – were made on the basis that a breach did not occur, yet few had grounds or evidence to support their appeal.

E3 advises that any development is evidenced, with proof of postage for documents and photographs of progress on site, or better still emails and electronic receipts comprehensively filed and retained.