Land Remediation Relief
In 2001, the Labour Government introduced one of the most generous tax reliefs available to incentivise the regeneration of derelict, contaminated and disused land. This doesn’t just apply to contaminated land but also includes removal of asbestos in existing buildings.
If you are an investor, 150% tax relief equates to the recovery of 28.5% of the total qualifying expenditure in the year of expense. If you are a developer 9.5% of the total expenditure can be recovered, usually at the point of disposal. For loss-making companies, a tax credit equal to 24% of the total qualifying expenditure is available, which can be a significant cash flow boost particularly early in a development programme.
How we can help
As part of a land purchase, one of the first elements of an appraisal is to understand the potential costs associated with the removal of natural and man-made contamination or below ground services. The implications of identifying these types of issues could have a bearing on the purchase price and even at the Heads of Terms stage, it is advantageous to assess the scope of qualifying remediation works. The potential cash flow benefit can have a considerable impact on a site appraisal and without specialist involvement, it is difficult to assess the true extent of Land Remediation Relief.
Our ability to interpret site investigation, environmental and remediation reports to identify the costs of qualifying remediation works has become indispensable to our clients.