The Government recently published a consultation on plans for the Building Safety Levy.
Under the proposals, the development of residential buildings, regardless of their height, would be liable for the levy contribution.
The Building Safety Levy was first announced as a charge payable on development of tall buildings in February 2021. Plans to extend it to cover all residential buildings were confirmed in April 2022.
The levy would apply to all new residential buildings requiring building control approval in England only and would be paid by the developer.
How would the levy work?
- The Government’s preferred option is for local authorities to collect the levy, as they have established systems, data, knowledge, and relationships in place with the developer sector
- Payment of the levy would be an integral part of the building control process for developments that require approval
- Checks and balances to monitor payment would be in place and non-compliance may result in sanctions and/or enforcement measures, including halting the progress of a development
- Prior to giving notice of commencement, the client would self-assess the total amount of levy to be paid based on the levy rate in that area, size of the project (either number of housing units or square metres) and any differential rate that is applicable
- 60% of the levy would be payable at the ‘notice to commence’ stage and would be sent to the relevant collection agency within a set timeframe
- The remaining percentage of the levy would be due prior to final certification stage
- At final inspection the relevant Building Control Officer would assess the actual completed project as part of the final inspection. Any variance between the total amount and the self-assessed amount would be applied at this point by the collection agency, who would issue an invoice
In order to boost the development of community facilities and smaller developments, certain exemptions to the levy have been proposed. These include:
- Affordable Homes
- Small Developments (under 10 units)
- NHS hospitals, medical centres, and NHS GP centres
- Residential Care Homes and Children’s Homes
- Refuges and residential domestic abuse facilities
- Criminal justice accommodation
- Military barracks and other military establishments
The consultation will last for 10 working weeks ending on 7 February 2023.
Read more articles on InSite and sign up to receive our blog round-up.
Every care was taken to ensure the information in this article was correct at the time of publication (December 2022). Guidance provided does not replace the reader’s professional judgement and any construction project should comply with the relevant Building Regulations or applicable technical standards. For the most up to date Premier Guarantee technical guidance please refer to your Risk Management Surveyor and the latest version of the Premier Guarantee Technical Manual.