Many homeowners are surprised to learn that under the Party Wall Act 1996, they may have to pay their neighbour for making use of existing structures. These payments are known as enclosure costs. Below, we break down what they are, when they apply, and how they’re calculated.
What Are Enclosure Costs?
Section 11(11) of the Party Wall etc. Act 1996 sets out the principle of enclosure costs. In simple terms, if you benefit from construction work that your neighbour previously paid for, you may be required to contribute a fair share of those costs.
Common scenarios include:
- Extensions – when you enclose upon a wall built by your neighbour to form part of your new extension.
- Loft conversions – when you use a wall your neighbour raised during their own loft conversion.
How Are Enclosure Costs Calculated?
The calculation is based on the current cost of building the wall, not its original construction price.
For example:
- A wall built in 1900 may have cost £1,000.
- If the same wall would cost £15,000 to build today, your share would typically be 50% (£7,500).
This figure includes materials, labour, professional fees, and other related expenses.
Who Receives the Payment?
Payment is made to the current adjoining owner, regardless of whether they originally paid for the wall. Even if they had no involvement in its construction, they are legally entitled to receive enclosure costs.
How Are Enclosure Costs Paid?
- The amount payable is decided by the appointed Party Wall Surveyors.
- This is set out in the Party Wall Award.
- Payment is usually made by bank transfer directly to the adjoining owner.
- The timing of payment is normally when the wall is enclosed upon, but surveyors can specify alternative arrangements in the award.
Why Enclosure Costs Matter
Enclosure costs can be one of the more complex — and sometimes contentious — aspects of the Party Wall Act. Getting it wrong could lead to disputes, delays, or unexpected expenses.
That’s why it’s essential to seek guidance from experienced surveyors who can handle the calculations fairly and protect your interests.
FAQs
Do I always have to pay enclosure costs when using a shared wall?
No. Enclosure costs only apply when you make use of a wall your neighbour previously built at their expense. Surveyors confirm whether the Act applies.
Who decides the exact amount of enclosure costs?
The appointed party wall surveyors determine the amount, which is then formally recorded in a Party Wall Award.
How is the enclosure cost calculated if the wall is very old?
The calculation is based on today’s rebuilding cost, not the original cost—even if the wall was built decades ago.
When do I need to pay enclosure costs?
Payment is usually due when you enclose upon the wall, but the surveyors may specify different arrangements in the Party Wall Award.
Does the neighbour receive the money even if they didn’t build the wall?
Yes. The payment goes to the current adjoining owner, regardless of who originally paid for the structure.
Get Expert Guidance Today
At Simple Survey, we specialise in helping homeowners understand and manage enclosure costs under the Party Wall Act. From clear advice to handling negotiations, our team is here to make the process smooth and stress-free.
📩 Email us today at team@simplesurvey.co.uk for tailored advice on your project.