Quick answer: Land Remediation Relief is a UK corporation tax relief giving qualifying companies an additional 50% deduction, on top of the standard 100% deduction, for cleaning up contaminated or derelict land acquired in that condition. Loss-making companies can surrender the additional deduction for a 16% payable tax credit.
What is Land Remediation Relief?
Land Remediation Relief is a corporation tax relief that gives qualifying companies an additional 50% deduction on top of the 100% revenue deduction for the cost of cleaning up contamination or derelict land that was acquired in that state. Qualifying expenditure includes the removal of contamination such as asbestos, hydrocarbons, heavy metals or Japanese knotweed, and the treatment of derelict conditions such as demolition of long-vacant structures. Both revenue and some capitalised expenditure can qualify, with an election available for capital spend.
How does HMRC define Land Remediation Relief?
HMRC guidance is in the Corporate Intangibles Research and Development Manual at CIRD60000 onwards, notwithstanding the different subject matter. The legislation is in Part 14 of the Corporation Tax Act 2009. Loss-making companies can surrender the additional deduction for a 16% payable tax credit under section 1151 CTA 2009.
What does a Land Remediation Relief claim look like in practice?
A property developer acquires a brownfield site for £2,000,000 and spends £600,000 removing contaminated soil and asbestos. The standard 100% revenue or capital allowance deduction is taken, plus an additional 50% under Land Remediation Relief, giving an extra £300,000 deduction against taxable profit in the relevant period. Use the free eligibility calculator to check whether related R&D expenditure on the same site could also qualify.
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Frequently asked questions
Land Remediation Relief is a corporation tax relief giving qualifying companies an additional 50% deduction on top of the standard 100% revenue deduction for the cost of cleaning up contamination or derelict land acquired in that state.
Qualifying expenditure includes removing contamination such as asbestos, hydrocarbons, heavy metals or Japanese knotweed, and treating derelict conditions such as demolishing long-vacant structures. Both revenue and some capitalised expenditure can qualify, with an election available for capital spend.
Yes. Loss-making companies can surrender the additional deduction for a 16% payable tax credit under section 1151 of the Corporation Tax Act 2009.