How does Land Remediation Relief work?
Like any tax relief there are conditions that must be met for a company to claim LRR.
The land must be in the UK and all claimants must:
- Be subject to UK corporation tax
- Have bought the freehold or a leasehold with seven or more years remaining
- Not be the polluter or be connected to the polluter
- Deduct the amount of any subsidy or grant received from any claim.
An overriding question is whether the company would have spent the money if the land or property had not been contaminated?
The timing of the benefit and the ability to make backdated claims depends on whether the spend is capital or revenue.
Whereas relief for revenue expenditure is claimed when the land or property is sold.
Claims must be made, and the relief is given, as follows:
- Capital spend – the relief is given in the accounting year the money is spent. It must be claimed within two years from the end of that accounting year.
- Revenue spend - the relief is given in the accounting year when the land or property is sold. It must be claimed up to four years from the end of that accounting year.
Types of clients
Companies who can benefit from LRR include house builders, property developers, property investors and owner occupiers.
How we help with Land Remediation Relief
It is not straightforward to ensure the required conditions are met and draw the line between qualifying and non-qualifying expenditure. Specialist advice pays for itself many times over.
Gateley Capitus has a team of Land Remediation Relief specialists, with expertise in surveying and tax. We have experience interpreting environmental and remediation reports and examining spending to maximise the cost of qualifying relief. We can even undertake a retrospective review of your projects and potentially find significant tax savings that were previously overlooked.