Newspaper article The Journal (Newcastle, England)

Clean-Up Will Net Tax Bonus

Newspaper article The Journal (Newcastle, England)

Clean-Up Will Net Tax Bonus

Article excerpt

Byline: By Richard Freeman-Wallace

The site of the proposed 500-acre Olympic Park in East London, at the heart of London 2012's successful bid is, in the words of the Mayor of London, on some of the most polluted soil in the country.

Clearing the site in readiness for Britain's biggest regeneration project will require a huge decontamination exercise before work can begin.

London 2012 should be able to recoup a significant sum through the Contaminated Land Tax Credit.

This has been a successful incentive for developing polluted land throughout the UK. It provides developers with tax relief for 150% of the total clean-up costs. The tax credit is an important step in encouraging developers to look at the possibilities of redeveloping and regenerating brownfield sites.

Currently, companies can claim 150% relief from corporation tax if they clean up contaminated land. Land qualifies if it is 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.

The money spent on remediation (cleaning up the land) qualifies if:

* it is spent on land which is contaminated;

* it is spent on paying employees and buying materials or is spent on sub-contractors;

* the cost was not subsidised by anyone else;

* it would not have been spent if the land wasn't contaminated;

* it is spent on remediation as defined by the Inland Revenue.

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%.

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 contaminated land.

When is land contaminated?

Contaminated land contains substances that, when present in sufficient concentrations, may cause harm to humans, animals, the environment or other sensitive receptors.

There is no internationally agreed definition of contaminated land. In the UK, contaminants are classified as hazardous materials, or gases, that do not occur naturally on a particular site. …

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