The Building Safety Levy comes into force in England on 1 October 2026, bringing a new development charge into the building-control process for qualifying residential schemes and purpose-built student accommodation. In London, the standard rate reaches £100.35/m² of chargeable floorspace in Kensington and Chelsea.
For developers, the critical questions are not limited to the headline rate. Liability depends on when the building-control application is submitted, whether the wider development meets the 10-home or 30-PBSA-bed threshold, how much new residential GIA is chargeable, whether the planning site passes the 75% previously-developed-land test and which exemptions apply.
Construction at Royal Victoria Dock in East London, photographed on September 2026. The Building Safety Levy begins on 1 October 2026 for qualifying residential development. Photo: London Construction Magazine.
What Actually Starts on 1 October 2026?
The legal framework is set by the Building Safety Levy (England) Regulations 2025, as amended by the Building Safety Levy (Amendment) (England) Regulations 2026. The amendment regulations were made on 12 September 2026 and, like the main levy regime, come into force on 1 October. The levy applies in England and is tied to building control rather than planning approval or the date construction physically starts. Current Government guidance states that applications for building control approval relating to dwellings or PBSA submitted on or after 1 October enter the new regime, subject to the charging conditions and exemptions.
Applications submitted before 1 October remain outside the levy. Importantly, the regulations also protect later variation applications and commencement notices where they relate to an original application made before the commencement date. But if a pre-1 October application is rejected and a fresh application is submitted on or after 1 October, the new submission can become liable. For higher-risk residential buildings, this means the levy should not simply be described as a separate "Gateway 2 charge". A Building Safety Regulator application can bring a project into the levy process, but the statutory mechanism is the building-control application and the levy rules applying to it.
The 10-Home Threshold Cannot Be Tested One Package at a Time
A chargeable scheme must meet three main conditions: the works must constitute or form part of a major residential development, they must create new residential floorspace, and the client must not be an exempt person. For levy purposes, major residential development means 10 or more new dwellings, or 30 or more new PBSA bedspaces. The important point for phased London schemes is that the test can follow the wider planning permission rather than the number of units in one building-control package.
The Government gives the example of a building-control application for seven houses within an estate with planning permission for 50 houses. The seven-house package is still treated as forming part of major residential development. Developers therefore cannot avoid the levy simply by dividing a larger planning permission into building-control submissions containing fewer than 10 homes.
| Example | Levy position |
|---|---|
| Standalone development creating 9 new homes | Below the major-development threshold. |
| Development creating 10 new homes | Can be chargeable if the other conditions are met. |
| 7-home building-control package within a 50-home planning permission | Can be chargeable because it forms part of a major residential development. |
| Standalone PBSA development with 29 new bedspaces | Below the PBSA threshold. |
| PBSA development with 30 or more new bedspaces | Can be chargeable if the other conditions are met. |
There is another important distinction. A project must create new residential floorspace. Government guidance gives an example of 10 existing flats being reconfigured into 35 PBSA bedspaces without creating new floorspace. Although the resulting scheme exceeds the PBSA threshold, the application is not chargeable because no new residential floorspace is created.
London Rates Vary Sharply by Borough
The levy is calculated by multiplying chargeable floorspace by the applicable local-authority rate. London Construction Magazine has previously published a detailed comparison of London Building Safety Levy rates. Kensington and Chelsea sits at the top of the current Government schedule at £100.35/m² for non-previously-developed land.
| London authority | Previously developed land | Standard rate |
|---|---|---|
| Kensington and Chelsea | £50.17/m² | £100.35/m² |
| Westminster | £49.01/m² | £98.01/m² |
| Hammersmith and Fulham | £45.94/m² | £91.87/m² |
| Camden | £43.56/m² | £87.12/m² |
| Tower Hamlets | £30.60/m² | £61.20/m² |
| Greenwich | £27.16/m² | £54.33/m² |
| Bexley | £24.00/m² | £48.00/m² |
The difference becomes substantial at project scale. As a simple worked example, 1,000m² of fully chargeable floorspace in Kensington and Chelsea would produce a levy of £100,350 at the standard rate. If the same development qualified for the previously-developed-land rate, the calculation would fall to £50,170.
The 75% Brownfield Test Applies to the Planning Redline
Government levy-rate guidance confirms that the previously-developed-land rate is 50% of the standard rate. To qualify, at least 75% of the land within the planning permission redline must meet the levy definition of previously developed land. This produces an important result for phased schemes. A building-control package located on an undeveloped part of a wider site can still receive the discounted rate if at least 75% of the entire planning redline qualifies. The reverse is also true: constructing directly on a previously developed part of a site does not secure the discount if the wider planning redline fails the 75% test.
The final 2026 amendment regulations also widen the statutory meaning of a building for this test. Permanent man-made structures and erections can count, including areas reinforced for load-bearing, paved or otherwise surfaced with man-made materials, as well as plant and machinery. Current Government guidance specifically identifies fixed surface infrastructure such as roads, car parks, loading bays, pavements and drainage as potentially within the definition. Underground structures require separate treatment. An underground part extending beyond the above-ground part of a building is excluded when calculating whether the 75% threshold has been met.
GIA Does Not Mean the Whole Building Is Automatically Charged
Chargeable floorspace is measured using gross internal area, but the levy is not simply the borough rate multiplied by every square metre in a mixed-use building. Chargeable GIA can include new market dwellings, new PBSA and communal space serving chargeable residents. The Government's calculation guidance says resident communal areas can include stairs, lobbies, landings, plant rooms and resident-only facilities such as a gym.
Where communal areas serve both chargeable and exempt units, only a proportion is charged. The calculation uses the relative floorspace of chargeable and exempt units using that communal area across the wider development. This makes tenure schedules and area information relevant to the levy calculation rather than merely to planning and sales documentation.
Social Housing and Other Exempt Uses Need Different Treatment
Social housing and supported housing are exempt where the statutory definitions are met. A private developer delivering qualifying social housing through a Section 106 obligation can therefore exclude that housing from chargeable floorspace, although the wider development may still pass the 10-home threshold. There is also an exemption at client level. A non-profit registered provider of social housing, or its wholly owned subsidiary, can qualify as an exempt person. Government guidance makes clear that a joint venture does not automatically inherit that status unless each party meets the exemption.
Other residential uses are excluded from the levy altogether, including hospitals, hotels and hostels, care homes and hospices, school accommodation, certain domestic-abuse accommodation, prisons and other secure residential accommodation, temporary accommodation for homeless people and specified armed-forces or Crown accommodation. There is an administrative distinction here. Applications consisting solely of social or supported housing can still require levy information and evidence before receiving a notice of no charge. Some uses listed as excluded accommodation do not enter that process in the same way.
The Client Pays, but the London Borough Collects
The person legally responsible for the levy is the client identified in the relevant building-control application or initial notice. The collecting authority is the relevant local authority. That remains the position where building control is being handled by a Registered Building Control Approver or, for a higher-risk building, by the Building Safety Regulator. The BSR does not become the levy collector. The relevant London borough calculates and collects the charge for buildings in its area.
Government guidance for developers sets out a two-stage information process. Levy information accompanies the building-control submission, followed by more detailed levy information and supporting evidence at the first commencement notice so that the collecting authority can determine the charge or issue a notice of no charge. Payment can be made after the levy liability notice is issued, but the statutory end point is strict. The 2025 Regulations require payment by the first completion notice or first occupation, whichever comes earlier. Building-control completion and final-certificate procedures also prevent the relevant certificate being issued or accepted while levy liability remains unpaid.
What London Developers Should Check Before Submission
For projects approaching building control on or after 1 October, the practical review should cover the planning permission, building-control route, client identity, residential unit or PBSA count, chargeable GIA, tenure mix, communal areas, applicable borough rate and evidence supporting any previously-developed-land or housing exemption.
- Confirm whether the planning permission constitutes a 10-plus-home or 30-plus-PBSA-bed development.
- Identify exactly which new residential and communal floorspace is chargeable.
- Test the entire planning redline against the 75% previously-developed-land rule rather than only the building footprint.
- Prepare evidence for social housing, supported housing or other claimed exemptions.
- Check that the correct levy information accompanies the building-control submission and later commencement information.
LCM's wider guide to rules changing on 1 October 2026 places the levy alongside the other regulatory changes beginning that day. For residential development, however, the Building Safety Levy is the change most directly capable of turning building-control timing, land classification and floor-area calculations into a material project cost.
The next fixed step is commencement on 1 October 2026. From that date, qualifying new building-control submissions enter the levy regime, while qualifying applications made before commencement retain the transitional protection set out in the regulations. Development teams submitting around the deadline should therefore work from the made regulations and current Government guidance rather than older consultation assumptions.
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Expert Verification & Authorship: Mihai Chelmus Founder & Editor, London Construction Magazine | Construction Testing & Investigation Specialist |