tax relief for contaminated land and derelict structures clean-up
A little-known and rarely claimed tax relief for companies incurring clean-up costs on contaminated land and derelict structures is being missed by UK companies. Land Remediation Relief was introduced in 2001 but is still rarely claimed. One possible reason for this is that many people are still not aware that the definition of land for the purposes of the legislation also includes buildings.
Land Remediation Relief is a corporation tax relief, providing deductions of up to 150% for qualifying expenditure incurred by companies cleaning up land and buildings. The relief is available for any additional costs incurred as a result of the land and buildings being in a contaminated state. This includes any additional investigation works, monitoring and remediation, staff costs and materials. Examples could include the removal of asbestos from buildings or the treatment of harmful organisms, and naturally occurring contaminants such as Japanese Knotweed, radon and arsenic.
Relief can be available on developments, regeneration projects, fit-outs and refurbishments
Who Can Claim?
Land Remediation Relief is a corporation tax relief and is available where companies acquire land and buildings in a contaminated or derelict state. The relief is not available to sole traders or partnerships which are not subject to corporation tax.
What Costs Can Be Claimed?
The general definition of contaminated land costs are those incurred in ‘preventing, minimising, remedying or mitigating any harm or pollution of land or controlled waters, by reason of which the land is in a contaminated state, or restoring the land or controlled waters to their former state’.
The expenditure qualifying for the relief is
- Staffing costs
- Subcontracted costs incurred from both connected and non-connected companies
- Professional fees incurred for advice on how to remediate the contaminated land
What If A Company Is Making A Loss?
The loss (or part of the loss) is available for surrender using a 16% payable tax credit rate. This means that a loss-making company can still receive a very valuable tax benefit when claiming land remediation relief.
Get In Touch With YesTax
If you have any questions about the Land Remediation Relief we’d be happy to hear from you at email@example.com
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