The Building Safety Levy comes into force today, affecting major new residential developments in England and posing another project viability challenge for developers. 

 Having been legislated under the Building Safety Act 2022, followed by formal guidance on its implementation published in July last year, the levy was created to help fund remediation of historical residential building safety defects.

The levy will be paid by developers on schemes that result in new dwellings, new bedspaces in purpose-built student accommodation (PBSA), and schemes involving a change of use to residential. It applies to any building control application under a planning permission that meets or exceeds the major development threshold of 10 dwellings or 30 PBSA bedspaces.

Local authorities will collect the levy and the rates have been weighted using average house prices across different areas. Ranging from £12.70 per m2 in County Durham to £100.35 per m2 in Kensington and Chelsea, the levy is expected to raise roughly £3.4bn over 10 years.