Building Safety Levy for developers (opens in a new tab)
Detailed guide to the levy, including rates, exemptions, and how to plan for levy costs.
Reactive (response to change)
Building Safety Levy now applies to new residential developments in England
The Building Safety Levy came into force on 1 January 2026, imposing a mandatory charge on eligible new residential developments in England. The levy funds the remediation of historical building safety defects, particularly unsafe cladding. Rates vary by region, with exemptions for social housing, affordable housing, and small developments.
Change event:
Building Safety Levy on new residential developments from January 2026
Effective 1 January 2026
Related guidance
Topics
Premises & Operations
Sector-Specific
What has changed
The Building Safety Levy (England) Regulations 2025 introduced a mandatory levy on eligible new residential developments in England from 1 January 2026. The levy funds the remediation of historical building safety defects — particularly unsafe cladding and fire safety issues identified following the Grenfell Tower tragedy in 2017.
The levy is collected through the building control process. It applies when a building control approval application or an initial notice is submitted for eligible residential development. It sits alongside the existing Building Safety Act 2022 framework, which is administered by the Building Safety Regulator within the Health and Safety Executive.
Who must pay the levy
The levy applies to developers of eligible new residential developments in England. It is triggered when you submit a building control approval application or an initial notice for a qualifying residential scheme.
The levy rate varies by region and development type, with higher rates applying in London and the South East to reflect higher land values and development margins. Developers must factor the levy into their financial appraisals and viability assessments for new schemes from the earliest planning stages.
Exemptions
The following types of development are exempt from the Building Safety Levy:
- Social housing — developments delivered entirely as social housing
- Affordable housing — qualifying affordable housing schemes
- Care homes — residential care facilities
- Hospitals — healthcare facilities with residential accommodation
- Small developments — schemes below a specified number of units
If your development includes a mix of exempt and non-exempt elements, check the regulations carefully. The exemption may apply to the exempt portion only, with the levy due on the remaining units.
How the levy is collected
The levy is collected through the building control process. You must pay it when submitting your building control approval application or initial notice. This means the levy cost arises early in the development process, before construction begins.
If you use an approved inspector (now known as a registered building control approver) rather than the local authority building control service, the levy still applies. The initial notice submission triggers the levy in the same way as a building control approval application.
Financial impact on development viability
The levy is an additional cost that must be factored into scheme viability from the outset. Failing to account for it could undermine development margins, particularly on sites with tight viability. The regional rate variation means developments in London and the South East face the highest levy charges. Review all current and pipeline schemes to assess the financial impact before submitting building control applications.
What you need to do
If you develop new residential buildings in England:
- Check whether your developments are eligible — review the regulations to confirm whether your schemes fall within scope or qualify for an exemption
- Update financial appraisals — factor the levy into viability assessments for all current and pipeline schemes, using the regional rate that applies to your site location
- Review building control submissions — ensure the levy is budgeted and payable before submitting building control approval applications or initial notices
- Adjust land purchasing calculations — the levy reduces residual land values, so account for it when negotiating site acquisitions
- Monitor rate updates — levy rates may change in future years, so check the current rates before each new submission
Devolved nations
The Building Safety Levy applies in England only. Scotland, Wales, and Northern Ireland have separate building safety arrangements and are not subject to this levy. If you develop residential buildings in multiple nations, ensure you apply the correct regulatory framework for each jurisdiction.
Building Safety Act compliance (opens in a new tab)
Overview of the Building Safety Act 2022 framework and the role of the Building Safety Regulator.
Building safety for higher-risk buildings (opens in a new tab)
Additional requirements for higher-risk residential buildings under the Building Safety Act.
Building regulations approval (opens in a new tab)
How building control approval works and when you need to apply.
Building control approval guide (opens in a new tab)
Step-by-step process for building control applications and initial notices.
Fire safety for high-rise buildings (opens in a new tab)
Fire safety obligations for high-rise residential buildings, including cladding requirements.