England to introduce Building Safety Levy for residential developers

The UK government is introducing the Building Safety Levy, a charge on new residential developments in England scheduled to take effect on 1 October 2026. The levy is calculated based on the floor area of residential buildings and is intended to fund the remediation of historic building safety defects, ensuring these costs do not fall on leaseholders. The government aims to raise approximately £3.4bn over 10 years through this measure.

The levy applies to major residential developments creating 10 or more homes, as well as purpose-built student accommodation with 30 or more bedspaces, regardless of building height. Developers are responsible for payment, and a completion certificate will not be issued until the levy is paid in full.

In response to these upcoming regulations, LendInvest and MDA Consulting have released a joint whitepaper titled ‘Building Safety Levy: Implications for Lenders & Monitoring Surveyors’. The guidance examines how the levy may impact development appraisals, scheme viability, cash flow timing, and project completions for developers and lenders.