Our Services - 4 Contaminated Land Remediation Expenditure Relief

Our Services - 1   TEC Professional Services Our Services - 2   Contamination Risk Assessment and Management Our Services - 3   TEC Environmental Health Check Our Services - 5   Geotechnical Engineering Ground Investigation - Risk assessment - Remediation - Tax Breaks - Geotechnical Engineering The introduction of tax credits for the remediation of contaminated land in the 2001 Finance Act offers some significant financial benefits to owners of contaminated sites as well as developers, so long as they did not cause the contamination themselves. In short, a company may treat qualifying land remediation expenditure as if it were an amount equal to 150% of the actual amount of expenditure and claim relief for that enhanced amount in the relevant accounting period. The qualifying land remediation expenditure must relate to any estate, interest or right in or over land acquired by the company for the purposes of a Schedule A business or trade carried on by the company. Key Points of the Legislation If you have or are proposing to purchase land that is, or may be to some extent contaminated, the new Finance Act provides the following advantages: The Finance Act, 2001, offers property developers &/or owners a 150% Tax Credit for the costs of cleaning up the land. Therefore, should you pay Corporation Tax at 30%, you could get 45% of your remediation expenditure back depending upon your financial status. The legislation is not retrospective and the Tax Credits can only be claimed for qualifying expenditure incurred after 11 May 2001, but can be claimed up to 2 years after the expenditure. A claim for a tax credit must be made in writing, in the form of a (quarterly to annual) tax return within two years of the end of the accounting period in which the expenses incurred. To qualify, the site (or any part thereof) must have been contaminated at the time of purchase. The purchase price for land can reflect its contaminated state, but the conveyance contract cannot refer to this cost reduction as a subsidy. Therefore, the price needs to be fixed before purchase with no retrospective payment from the vendor for remedial costs. Preparatory works costs (such as site investigation and consultancy costs) can be included, so long as remediation has subsequently been undertaken. The "polluter" cannot claim tax credits under any circumstances. Nor can a third party that acquires a controlling stake in the shares of a company that caused the contamination. Tax Credits can be claimed (where suitable records exists) for direct costs and sub-contractor costs. This legislation is to be reviewed after five years and may then be revised or repealed TEC not only provides a comprehensive range of services from the provision of advice on the potential liabilities associated with the ownership of land, but is able to provide expert advice and the technical assessment required to claim contaminated land tax credits. Copyright   ©   philchave.com and tecon.co.uk   .  All rights reserved.