The following Owner-Managed Businesses guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
Companies that acquire contaminated or derelict land for the purposes of their trade or UK property business can claim an enhanced deduction of 150% for clean-up costs. The relief is not available to individuals or partnerships. However, a company that is a member of a partnership can claim relief for its share of the partnership’s qualifying land remediation expenditure.
By election, relief can be claimed by a company for capital expenditure incurred on remediation of land acquired for use in its trade or for its UK property business to be given as a 150% revenue deduction in computing the profits of that trade or business, although not for expenditure that qualifies for capital allowances.
Where the enhanced deduction results in a loss then the loss can be used in the normal way or it can be surrendered in return for a cash payment.
Further details of land remediation relief can be found in CIRD60000.
See also Simon’s Taxes D1.5.
The qualifying conditions for the relief are that the company has acquired a major interest in the land in the UK for the purposes of a UK property business or a trade carried on by the company. The land must have been in a contaminated state at acquisition, although this is not a requirement if the land is contaminated by Japanese knotweed. Alternatively, the land must have been in a derelict state throughout the period beginning on the earli
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