Property · Landlords and HMO investors
Article 4 and HMO compensation: can you claim, and by when?
Compensation is normally only available where the council made an immediate Direction (less than 12 months' notice), you applied for planning permission within 12 months of it taking effect, the council refused it or imposed tighter conditions than permitted development, and you made a written claim within 12 months of that decision. Miss either 12-month deadline and the claim is normally lost.
Written by Vanessa Challess, Solicitor, qualified 2003 · Last reviewed
Who this is for, and when to call
- Your council has announced or made an Article 4 Direction covering HMOs
- You were part way through a small HMO conversion when it took effect
- Your planning application has been refused, or granted on tighter conditions
- You own or are buying property in an Article 4 area and want to know where you stand
Call as soon as a Direction is announced. The first deadline runs from the day it takes effect, and the planning application has to be in before it.
Work out where you stand
Two quick tools. They run in your browser and store nothing.
Deadline calculator
Enter the dates from the council's notice and, if you have one, its planning decision.
Your deadlines will appear here.
A guide only, not legal advice. Both deadlines are given as the day before the 12-month anniversary. Check every date against the Direction and the decision notice themselves.
Eligibility checker
Six questions. Nothing you enter leaves this page.
1. Is the scheme a small HMO, for three to six people?
2. Did the Direction take effect with less than 12 months' notice?
3. Do you own or lease the property?
4. Did you apply for planning permission within 12 months of the Direction taking effect?
5. Did the council refuse it, or grant it on tighter conditions than permitted development?
6. Is it less than 12 months since the council's decision?
0 of 6 answered.
A guide only, not legal advice. It covers HMO Directions in England.
What we do, stage by stage
Check the Direction
Within days
We confirm whether it was immediate or non-immediate, whether your property is inside the boundary, and diarise both 12-month deadlines from day one.
Planning application
Within 12 months of it taking effect
We work with your architect or planning consultant so the application mirrors what permitted development would have allowed, not an enlarged scheme.
Evidence
After the decision
We list which costs are realistically recoverable, gather invoices and contracts, and brief your valuer on the fall in value.
Written claim
Within 12 months of the decision
We prepare and submit the claim, setting out the legal basis, the planning history and each head of loss.
Negotiation
Usually several months
We deal with the council and, if the claim is disputed, instruct counsel and take it to the Upper Tribunal (Lands Chamber).
How we charge
- Article 4 initial review: a fixed fee of £295 plus VAT (£354 in total)
- The review covers: whether the Direction is immediate and covers your property; both 12-month deadlines worked out and diarised; whether a claim, a Certificate of Lawfulness or a planning-first route fits your facts; which costs look recoverable and what evidence is missing; a short written note and a 30-minute call to go through it
- To start, send us the Direction and its notice, any planning decision, your title or lease, and your invoices so far
- Planning application support, claim preparation and negotiation are not included, and are quoted in writing before you commit
- Likely disbursements: valuer's fees, planning consultant's fees and, if the claim goes to the Tribunal, counsel's fees and Tribunal fees
Who will do the work
Vanessa Challess, Solicitor, qualified 2003, and Director of Bonsai Law. She has spent more than two decades on commercial, corporate and property disputes, and handles your matter herself.
Where the rules come from
- Town and Country Planning Act 1990, section 108: compensation when permitted development rights are withdrawn, the 12-month application window (s.108(2A)) and the 12 months' to two years' notice exception (s.108(3B) and (3C)).
- Town and Country Planning Act 1990, section 107: the two heads of claim: abortive expenditure, including preparing plans, and other loss or damage directly attributable.
- Town and Country Planning Act 1990, sections 117 and 118: how the fall in value is assessed, and disputed claims going to the Upper Tribunal (Lands Chamber).
- Town and Country Planning (General Permitted Development) (England) Order 2015, Schedule 3: how Directions are made, and the rule that an immediate Direction lapses after six months unless confirmed (paragraph 2(6)).
- Town and Country Planning (Compensation) (England) Regulations 2015, regulations 2 and 4: the house to small HMO change (Class L) is prescribed development, and the maximum two-year notice period.
- Town and Country Planning General Regulations 1992, regulation 12: the written claim must be served on the council within 12 months of the decision, unless the Secretary of State allows longer.
Article 4 compensation: common questions
It is a planning control that removes certain permitted development rights in a defined area. For HMOs, it usually removes the automatic right to change a family house into a small HMO of three to six unrelated people, so a planning application is needed instead. It is not a ban, and you can still apply.
A non-immediate Direction gives at least 12 months' and no more than two years' notice before it takes effect, and compensation is normally not available. An immediate Direction takes effect straight away or on shorter notice, lapses after six months unless the council confirms it, and may give rise to compensation.
Possibly. You need an interest in the property, a planning application made within 12 months of the Direction taking effect, a refusal or more restrictive conditions, and a written claim within 12 months of the decision. The Secretary of State can extend the claim deadline, but you should not rely on that. A short review of the Direction and your timeline will tell you quickly.
Yes. The council's decision on a timely application is what triggers the right to claim. Without an application there is normally no claim.
Abortive expenditure, such as architects' and planning consultants' fees, surveys, reports and preparatory works that became pointless, and other loss directly caused, mainly the fall in value of your interest, supported by an independent valuation.
General business risk, your own time, speculative future profit beyond the valuation, stamp duty and conveyancing costs, the costs of large HMO schemes that always needed permission, and finance costs unless directly caused by the Direction.
Generally not. Article 4 is not retrospective, but the HMO use must actually have started, with people living there. A finished building or a property ready to let is usually not enough. Keep tenancy agreements, council tax and licensing records, and consider a Certificate of Lawfulness of Existing Use.
Act quickly. If it is non-immediate, a genuine small HMO use that begins before it takes effect may protect the property, but compensation will not usually be available afterwards. If it is immediate, the 12-month application clock starts when it takes effect.
No. Licensing and planning are separate regimes. One does not imply the other.
No. It is a statutory compensation scheme and fault is not the test.
Evidence and negotiation usually take several months after the decision. A disputed claim can go to the Upper Tribunal (Lands Chamber) and take considerably longer. There is no fixed payment date, so do not plan refinancing around it.
No. Different rules apply in Wales. This page covers England.
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General information about the law in England, last reviewed 24 October 2026. It is not legal advice and should not be relied on for any particular property. Different rules apply in Wales. Bonsai Law Ltd is incorporated in England (company number 13926937) and authorised and regulated by the Solicitors Regulation Authority (SRA No 8000734). Registered office: The Business Terrace, Maidstone House, King Street, Maidstone, Kent ME15 6JQ. Complaints