Overage is a sum of money which may be due to a landowner after completion of any sale of the property.
It could be that overage is paid when the developer obtains planning permission based on the difference in the value of the land with or without planning permission. However, in our experience overage is usually a profit sharing arrangement between a landowner and a developer and payable once a developer has realised a profit on the development. There are likely to be tax consequences for overage arrangements.
The wording of overage arrangements can be very complex and it is important that expert legal advice is obtained in ensuring that the overage arrangements reflect the intentions of the parties and that most importantly the developer is obliged to pay the overage to you!