Contaminated Land Remediation

Contaminated land remediation should be carefully planned to ensure that the risks identified during assessment of the land are appropriately managed.

Remediation objectives should ensure that risks are assessed and attended to.

It is all to often thought that remediation will only result in environmental improvement. it is forgotten that the remedial activity itself has the potential to adversely impact on the environment despite the remediation of the immediate contaminated land.

It is for these reasons that the implementation of a remediation scheme and the application of legislative control are maintained to strict standards.

Contaminated land and tax relief

The Government proposes to introduce an accelerated payable tax credit for costs incurred by companies in cleaning up contaminated land sites.

Contaminated land sites can have significant negative impacts on the environment, local households and businesses. They provide a significant barrier to redevelopment of the land.

It is for these reasons that the Government encourages the clean up of contaminated land by introducing an enhanced tax relief for the costs incurred by companies in cleaning up land they acquire in a contaminated state.

Businesses can claim relief from corporation tax if they clean up contaminated land. You can claim tax relief of 150 per cent of the clean-up cost.

If the land is located in the UK and was acquired by the company to carry out its trade and at the time it was acquired all or part of it was contaminated

To qualify for tax relief the money spent on remediation must meet the following criteria:

  • It is spent on land which is contaminated
  • It is spent on remediation as defined by the Inland Revenue
  • It is spent on paying employees and buying materials or is spent on sub-contractors - Futher information on the Inland Revenue website
  • It would not have been spent if the land was not contaminated
  • The cost was not subsidised by anyone else

You need to claim for land remediation tax relief in your tax returns. If your company makes a loss because of spending money on cleaning up land, you can apply for a tax credit of 16 per cent.

The relief is only available to companies, not to individuals or partnerships. Relief is not due if the contamination is due to something done, or not done, that created the contamination.

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