Prepared by the Brady Solicitors litigation team. Brady Solicitors advises developers, freeholders, managing agents and residential property professionals on Building Safety Act obligations, planning and development matters, and residential property disputes.
From 1 October 2026, developers and freeholders in England filing building control applications for new residential developments of 10 or more dwellings will face a new charge. The Building Safety Levy can add six figures to a central London scheme’s cost. If you have a residential development in the pipeline, you need to know what it is, how it is calculated, and what you can do about it.
What is the Building Safety Levy?
The Building Safety Levy is a charge on new residential developments in England, introduced by the Building Safety Act 2022 and brought into force by The Building Safety Levy Regulations 2025, made on 19 November 2025. Local authorities collect it and the money raised contributes to fixing building safety defects across England, with the government estimating the levy will raise approximately £3.4 billion over 10 years.
The levy applies to building control applications submitted on or after 1 October 2026, therefore applications submitted before that date are not subject to it. Regulation 1(6) extends this transitional protection, stating variation applications and commencement notices given on or after 1 October 2026 are also outside the levy if they relate to an original application made before that date. This is relevant to developers who lodge their original building control application in September 2026, but are still varying it or commencing work months later.
Which developments are in scope?
The levy applies to major residential development: at least 10 net new dwellings, or at least 30 net new Purpose Built Student Accommodation (PBSA) bedspaces. The net element matters because, for example, converting a building with 5 existing dwellings into 14 produces a net addition of 9, so the levy does not apply.
The levy also catches applications forming part of a wider development with planning permission for major residential development, even if the individual application is below 10 dwellings. This requires a planning permission for the wider development to exist. If a single planning permission covers 30 dwellings and you submit building control applications in batches of 9, each batch is caught. Splitting applications to avoid the levy will not work where there is a single underlying permission.
How the levy is calculated
The charge is per square metre of chargeable floorspace, measured as gross internal area (GIA) under the RICS Code of Measuring Practice. GIA must be in square metres, rounded to the nearest whole number.
Schedule 3 of SI 2025/1236 sets two rates for every local authority in England, a standard rate and a lower previously developed land (PDL) rate. The PDL rate is consistently half the standard rate, with rates being weighted by average house prices.
Communal areas and the brownfield discount
Communal areas used wholly or partly by residents of chargeable dwellings count as chargeable floorspace, such as lobbies, lifts, residents-only gyms and car parks. This matters for schemes with substantial amenity provision, including build-to-rent and PBSA. In mixed-tenure developments, communal floorspace is apportioned pro-rata between chargeable and exempt dwellings.
The lower PDL (previously developed land) rate applies if at least 75% of the development site is made up of previously developed land. This is worked out by looking at the entire site boundary (shown by the “red line” on the planning permission), not just where the buildings are located.
For example, if 80% of the site is previously developed land, the lower rate applies – even if the new homes are built on the remaining 20% of undeveloped (greenfield) land.
However, if only 60% of the site is previously developed land, the lower rate does not apply – even if all the homes are built on that portion.
It’s also worth noting that applications made under permitted development rights automatically qualify for the lower rate, regardless of the type of land.
Exemptions
Social housing and supported housing floorspace (as defined in Schedule 2) is excluded from the chargeable calculation (regulation 8), but bear in mind that not all affordable housing products qualify. The exemption tracks the specific Schedule 2 definitions, not broader planning or tenure categories. PBSA, build-to-rent, and retirement housing do not automatically qualify.
There’s also an exempt person category under regulation 13. If the applicant is an exempt person, the entire application is not chargeable. Regulation 13 defines an exempt person as a non-profit registered provider of social housing or a company wholly owned by such a provider. For-profit registered providers are not exempt persons, even though they are registered providers. This distinction matters because there are for-profit registered providers operating at meaningful scale on section 106 affordable housing.
The pre-October window
Applications submitted before 1 October 2026 are not subject to the levy. For developments in planning or pre-application stage, this creates an incentive to advance building control submissions. A 50-unit Westminster scheme saves approximately £392,000 by filing before October.
For higher-risk buildings going through the Building Safety Regulator (BSR) gateway, the timeline is less flexible. Gateway approval can take 8 weeks or more, and a premature application risks rejection: a rejected pre-October application does not protect you from the levy on resubmission. Our practical advice is: if your application is genuinely ready, then the saving is real and the decision should be made now. If it is not, do not submit incomplete work to beat a deadline.
Payment and enforcement
The levy is not paid at application stage. At commencement, you provide detailed levy charging information (GIA, PDL status, exempt floorspace proportion). The collecting authority issues a levy liability notice within 5 weeks (or 8 weeks if a spot-check is carried out). Meaning you pay after receiving the notice.
The critical point is that the full levy for an application must be paid before any completion certificate can be issued for any works in that application. Regulation 58 amends the 2010 Building Regulations to enable building control authorities to withhold completion certificates where the levy is unpaid, and regulation 60 lets registered building control approvers reject final certificates on the same basis. Without a completion certificate, you can’t sell, occupy, or close out warranties.
For phased developments, this matters. If a single application covers two phases and Phase 1 completes while Phase 2 is still under construction, you can’t get Phase 1’s completion certificate until the full levy for both phases is paid. A good idea is to consider whether separate applications per phase might serve your cash flow better.
Challenging a levy charge
If you believe a levy liability notice is wrong, regulation 71 gives you the right to request a review by the collecting authority. If that does not resolve the dispute, you can pursue an appeal to the First-tier Tribunal.
Taking advice
The Building Safety Levy is a new cost on most new residential development in England from October 2026. A scheme that has properly assessed its PDL position, identified exempt floorspace, and made an informed decision on application timing will be in a better position than one that treats the levy as an afterthought. If you are uncertain whether a scheme or product type qualifies for an exemption, it is important to get that confirmed before the building control application goes in.
