29.06.2026
The Government has updated its guidance on the Community Infrastructure Levy (CIL), providing additional clarification on how indexation should be applied to developments that benefit from outline planning permission. The update was published by the Ministry of Housing, Communities and Local Government (MHCLG) on 17 June 2026 as part of the national CIL guidance. Please read on for more details.
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The Community Infrastructure Levy is a charge that can be imposed by local authorities on new development to help fund infrastructure such as schools, transport improvements, parks and community facilities. Although CIL rates are set locally through adopted charging schedules, the way in which charges are indexed is governed by national regulations.
Indexation is an important component of the calculation, ensuring that levy charges reflect changes in construction costs and economic conditions over time.
The latest guidance clarifies how indexation should be applied where development proceeds under an outline planning permission.
Specifically, the guidance confirms that, for the purposes of calculating the "Ip" index figure within the CIL formula, the relevant year is the year in which the outline planning permission was granted. This applies regardless of when reserved matters approvals are subsequently secured or whether the development is delivered in phases.
The clarification is significant because many larger developments can take several years to progress from outline consent through to reserved matters approval and delivery. During that period, construction indices can increase considerably.
The guidance provides greater certainty for developers, landowners and local authorities when calculating CIL liabilities associated with outline permissions.
For long-term schemes, particularly larger residential developments, the clarification may reduce the impact of subsequent increases in indexation that occur after outline permission has been granted. In practice, this could result in lower levy liabilities than might otherwise have been assumed if later reserved matters approvals were used as the relevant indexation date.
The update is generally being viewed as a clarification of the existing regulatory framework rather than a substantive policy change. However, the additional guidance should help to reduce ambiguity and support a more consistent approach to calculating CIL liabilities across England
For many development schemes, particularly larger residential-led developments progressing through phased delivery programmes, CIL forms a significant component of overall development costs. Greater certainty around how indexation is applied can therefore have important implications for viability appraisals, land negotiations and project budgeting.
Understanding how CIL liabilities are calculated at different stages of the planning process is increasingly important, particularly where developments are subject to Section 106 obligations, affordable housing requirements and other infrastructure contributions. For schemes with outline permissions granted several years before reserved matters approvals are secured, the clarification may assist in providing greater certainty when assessing development costs and financial viability.
Developers progressing schemes that benefit from outline planning permission may wish to review existing CIL assumptions, particularly where there has been a significant gap between the grant of outline consent and the approval of reserved matters.
Given the complexity of CIL calculations and the potential financial implications, applicants should seek confirmation of any liability from the relevant charging authority and obtain specialist advice where necessary.
The clarification provides greater certainty on a technical but potentially significant aspect of the Community Infrastructure Levy regime. While the update is generally viewed as confirming how the Regulations were intended to operate, it could have important cost implications for larger developments where there is a lengthy period between the grant of outline permission and the approval of reserved matters.
DHA Planning's Viability Team, led by Director Danielle Lawrence, advises public and private sector clients on development viability throughout the planning and delivery process. The team provides support on site feasibility, viability appraisals, Section 106 negotiations, Community Infrastructure Levy liabilities and late-stage review mechanisms across a wide range of development schemes. As changes to national guidance and policy can directly affect development costs and overall scheme viability, it is important that applicants regularly review financial assumptions and seek appropriate professional advice where necessary.
If you would like to discuss the implications of CIL, Section 106 obligations or wider development viability considerations for your scheme, DHA Planning's Viability Team can provide expert advice from the earliest feasibility stage through to planning determination and delivery.
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