Land Remediation Cash and Tax Benefits
What is Land Remediation tax relief?
Land Remediation tax relief was introduced in 2001 to encourage bringing derelict or contaminated land back into productive use.
GKA Innovation conducts a comprehensive assessment of your land modification activities in order to assess whether a portion of these can be recovered, in accordance with the scheme.
How can my company benefit?
Your company can benefit, whether it pays tax or not, by receiving a cash injection of up to £29 for every £100 of qualifying expenditure (whether expensed or capitalised). The level of benefit depends on the corporation tax position of the company and whether the qualifying expenditure has been expensed or capitalised. Loss-making companies can receive between £8 (break-even) and £24 for every £100 of qualifying expenditure (large loss) – this is achieved by surrendering a portion of the company’s tax losses for a payable cash credit.
What are the qualifying criteria?
There are three qualifying criteria:
- Your company must have a major interest in the land – this means a lease of at least 7 years or a freehold.
- The land must have been long-term derelict or contaminated at the time of acquisition
- The company must have incurred qualifying costs in order to put the land into a productive state in the relevant accounting period. However, the remediation work does not need to have been completed in the period.
What type of costs qualify?
There are 3 qualifying cost categories:
- Staffing costs – including gross salaries, employer NI, employer pensions, reimbursed travel costs, and bonuses
- Subcontracting costs – payments to companies, partnerships or sole traders, whether based in the UK or abroad
- Materials – those used directly in remediation work e.g. chemicals, cement used for ground barriers
Can my company claim both Land Remediation and R&D?
Of course – the Land Remediation claim is simply applied in addition to the R&D claim.
There are no issues, provided that the company is not claiming the same expenditure twice for two different schemes. If this is the case, we can advise you appropriately.
Can I claim retrospectively?
Yes – a company can file a claim up to two years after the end of a relevant accounting period.
How can GKA Innovation help?
Using our industry expertise, we will sift through your land development documentation to produce a comprehensive report which supports your claim – we have never had a claim rejected.
Moreover, we are completely familiar with the complex areas of the legislation and know the typical pitfalls companies can experience when making a claim – we avoid these pitfalls for you, so you don’t fall in.
How long does the process take?
GKA can complete a claim in as little as one week. Minimal input is required from yourselves – we simply require the relevant financial and land-related documents for us to compute the claim and write the technical report.
