New levy regulations set out arrangements for 'misapplied' receipts

New levy regulations set out arrangements for 'misapplied' receipts

Parish councils which do not use Community Infrastructure Levy (CIL) receipts to support the development of their areas could have to repay the funding, draft regulations for the regime propose.

The draft regulations, just published by the Department for Communities and Local Government, sets out the detail of the proposed new regime. It includes provision that where there is a neighbourhood development plan in place, “or permission granted by a neighbourhood development order (including by a community right to build order)“ the charging authority must pass 25 per cent of the CIL funds to the parish councils in whose area the chargeable development takes place.

Where there is no neighbourhood development plan this amount would be 15 per cent, subject to a cap of £100 per household in the parish council area per year, according to the draft regulations.

In Wales, the charging authority must pass 15 per cent of levy funds to the community councils in whose area the chargeable development takes place. A similar cap would apply.

The draft regulations state that a parish council must use the CIL receipts passed to it to support the development of its area by funding "the provision, improvement, replacement, operation or maintenance of infrastructure", or "anything else that is concerned with addressing the demands that development places on an area".

The draft regulations say the charging authorities would be able to recover funds from the local council in "certain circumstances".

The explanatory notes to the draft regulations said these circumstances would occur "if the local council has misapplied the CIL by not using it to support the development of their area or by using it for another purposes”.

The notes added: "When levy receipts are recovered from a local council, the charging authority must use those funds to support development in the area of that local council."

Roger Milne
21 February 2013