Work highlight / 20 Jul 2017
We became involved whilst the initial pre-contract discussions took place and reviewed the initial site investigation report and subsequent remediation statement of a disused foundry site for an investment client.
The intention was to develop the site out as a retail park.
Project: Redevelopment of former foundry site in Wales
Total expenditure: £1.48m
Total land remediation relief deduction: £1.2m
Total tax saving @ 20%: £228,000
Our initial assessment of the required works to clean up the site identified significant expenditure qualifying for land remediation relief. The entire site suffered chemical contamination from previous industrial use with an infestation of Japanese Knotweed, furthermore, the site contained discernible stockpiles of asbestos.
Our initial findings were incorporated into the appraisal process and positively influenced the viability of the project. Our ability to understand the nature of the remediation works enhanced the total qualifying expenditure significantly and the cash flow benefit equated to 30% of the total qualifying spend available in the year of expenditure.
We provided a complete service, provided an initial no-cost assessment of the site at the pre-contract stage then working with the on-site remediation contractors to gather all relevant information for reconciliation to the client’s accounts. Ultimately preparing a fully disclosed valuation report suitable for appending to the client’s tax return and preparing the relevant election to treat qualifying expenditure as revenue.
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.