The Building Safety Levy will come into force across England on 1 October 2026, adding a new charge to qualifying residential and purpose-built student accommodation developments submitted into building control from that date. London developers face some of the highest rates in the country. In Kensington and Chelsea, the standard rate reaches £100.35 per square metre of chargeable residential floorspace, while Westminster is £98.01/m² and Hammersmith and Fulham £91.87/m².
The levy is intended to raise around £3.4 billion over roughly ten years to help meet the cost of remediating building safety defects. Local authorities will collect the money, but the statutory responsibility for payment sits with the client identified in the relevant building control application or initial notice. For London projects already approaching building control submission, the important date is therefore not planning approval or a future construction start. It is whether the relevant building control application is submitted before or on or after 1 October 2026. London Construction Magazine previously examined this programme risk in its analysis of the Building Safety Levy's 75% previously-developed-land test.
Construction activity in central London. The Building Safety Levy will apply to qualifying residential developments entering building control from 1 October 2026. Original photograph: London Construction Magazine.
What Actually Changes on 1 October?
The levy applies to relevant building control applications and initial notices submitted on or after 1 October 2026 where the works form part of a major residential development and the other charging conditions are met. For levy purposes, a major residential development means a development providing at least 10 new dwellings, or at least 30 new bedspaces where the development is purpose-built student accommodation.
That threshold is linked to the wider development covered by the planning permission, not simply the number of homes contained in an individual building control application. A larger scheme cannot therefore avoid the levy merely by dividing building control submissions into packages containing fewer than 10 dwellings. There is also an important administrative distinction. Applications relating to the creation of one or more dwellings or PBSA bedspaces may still need to contain levy information even where the development ultimately qualifies for an exemption or receives a notice of no charge.
London Levy Rates Reach £100.35 per Square Metre
Rates are set separately for each local authority and are charged against qualifying floorspace. Government methodology weights the rates using average house prices, which means higher-value London boroughs carry substantially higher charges than many other parts of England.
| London authority | Previously developed land rate | 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 |
| City of London | £43.52/m² | £87.04/m² |
The calculation is not simply the borough rate multiplied by the total building GIA. Chargeable floorspace is the new residential floorspace subject to the levy, measured using gross internal area, and can include qualifying communal areas such as stairways, lobbies, landings, plant rooms and resident-only facilities. Affordable and other exempt accommodation is excluded from chargeable floorspace, while communal areas serving a mixture of chargeable and exempt uses are apportioned under the regulations.
The 75% Brownfield Test Can Halve the Rate
Developments qualifying as being on previously developed land receive a 50% reduction against the standard local authority levy rate. However, the test applies to the planning permission redline rather than simply the footprint of the particular building being submitted for building control. At least 75% of the land within that redline must meet the regulations' definition of previously developed land for the discounted rate to apply.
This can materially affect phased London developments. Government guidance gives the example of a building being constructed on the undeveloped part of a site still benefiting from the lower rate where more than 75% of the wider planning site qualifies as previously developed land. Conversely, construction taking place directly on previously developed land does not secure the discount where the wider planning redline fails the 75% test.
Which Residential Schemes Are Exempt?
Developments of fewer than 10 dwellings, or fewer than 30 PBSA bedspaces, are outside the major residential development threshold. Social housing and supported housing can also be exempt, together with specified accommodation including hospitals, care homes, hospices, hotels, hostels, children's homes, domestic abuse refuges, prisons, almshouses and temporary accommodation for homeless people.
Non-profit registered providers of social housing and their wholly owned subsidiaries are also exempt persons under the regulations. A joint venture is not automatically exempt: each party must meet the exempt-person test for that treatment to apply. For mixed-tenure developments, exempt affordable housing does not attract the levy, but market housing within the same qualifying development may still be chargeable.
Submission Before 1 October Could Be Worth Millions
Applications submitted before the commencement date are outside the levy regime. Government guidance also confirms that later variation applications, amendment notices or change-control applications relating to an original application made before 1 October do not bring that original application into the levy. The position changes if an application made before the deadline is rejected and then has to be resubmitted on or after 1 October. The resubmitted application can become liable.
For higher-risk buildings, this makes building control submission strategy particularly important because levy timing sits alongside the separate Building Safety Regulator approval process. LCM's guide to building control approval for higher-risk buildings explains why a submission, validation and approval are different regulatory stages.
LCM analysis: the practical risk is therefore not simply a new line in a development appraisal. A scheme close to the deadline must have sufficiently mature information to make a valid building control submission. Bringing forward an incomplete application solely to beat 1 October creates the possibility of rejection and a post-deadline resubmission, potentially converting programme delay directly into additional development cost.
Non-Payment Can Stop the Completion Certificate
The levy is calculated after further information and evidence is provided at commencement stage. The collecting authority then determines the charge and issues either a levy liability notice or a notice of no charge. Government guidance states that this assessment can take up to eight weeks in the relevant process. The levy may be paid after the liability notice is received, but the full amount must be settled before a completion certificate can be issued for the works covered by the application.
For higher-risk buildings, the Building Safety Regulator must not issue a completion certificate where the collecting authority confirms that a levy balance remains outstanding. Local authorities must similarly refuse a completion certificate, or reject a final certificate under the registered building control approver route, where the required levy has not been paid. That creates a direct programme and cash-flow interface between development finance, building control and occupation strategy. It is separate from planning permission, Gateway 2 approval and physical completion of construction.
What London Developers Need to Do Now
Projects approaching building control should establish whether the planning permission meets the 10-dwelling or 30-PBSA-bedspace threshold, identify exempt floorspace, check whether the wider planning redline satisfies the 75% previously-developed-land test and model the correct borough rate against chargeable GIA.
Teams targeting a pre-1 October submission also need to distinguish a genuine submission strategy from a rushed regulatory filing. For taller residential schemes, this deadline arrives immediately after another major compliance milestone examined in LCM's analysis of the September 2026 second-staircase transition.
The next meaningful step is implementation on 1 October 2026. From that date, the levy becomes part of the building control process for qualifying new applications, making land classification, chargeable floorspace, application timing and completion-stage payment matters that need to be managed alongside design, procurement and construction programme decisions rather than left until the end of the project.
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Expert Verification & Authorship: Mihai Chelmus
Founder, London Construction Magazine | Construction Testing & Investigation Specialist |
