West Berkshire Council was recognised in Parliament for its approach to the Community Infrastructure Levy (CIL) for private homeowners.
A Westminster Hall debate on Wednesday 29 April looked at how CIL can hit householders when complex exemption paperwork is completed wrongly.
MPs highlighted the council's discretionary CIL household review scheme, set up two years ago to review cases where paperwork errors meant homeowners wrongly became liable.
The council completed reviews and agreed discretionary repayments of between £12,000 and £40,000 to return money people should not have had to pay.
The retrospective review scheme has now closed.
The council's approach was praised as an example of how authorities can fix injustice within the rules, and the Government said it will consult on reforms to reduce the risk of homeowners being unfairly trapped by complex admin.
Council leader Jeff Brooks (Lib Dem, Thatcham West) said: "We've always believed that fairness has to sit at the heart of how the Community Infrastructure Levy is applied.
"I'm very proud that West Berkshire was highlighted in Parliament for the steps we've taken to review cases where residents were caught out by genuinely confusing processes, and to return money where it should never have been charged.
"Recognising when something isn't working as intended and taking action is simply the right thing to do, and I welcome the growing recognition that this approach should be adopted more widely."
The discretionary CIL household review scheme remains open to other eligible residents who believe they may have been wrongly charged and wish to apply for their case to be reviewed.
Niki Hinman, Local Democracy Reporter
