Legislation Conditions
Do you qualify for tax credit?
There are five basic conditions to be met in order for the expenditure to qualify for tax credit.
- The claimant must be a UK company within the charge to corporation tax. Relief for capital expenditure is given by deeming it to be allowable as a deduction in computing the profits of the trade for the accounting period in which the expenditure is incurred.
- Land in the United Kingdom (including buildings on the land) must be acquired in a contaminated state. The company must have a legal interest in the land and neither the company, nor anyone connected with the company, must have been responsible for polluting the site.
- The expenditure on remediation must be incurred on a) employee costs and (b) materials, or on sub-contracted land remediation.
- The expenditure would not have been incurred if the land had not been in a contaminated state.
- The expenditure must not be subsidised.
Additional conditions introduced since 1 April 2009:
- The interest in land must be major - freehold or leasehold longer than 7 years.
- Must not be obligated to carry out remediation under a statutory notice.
Additional condition particular to derelict land:
- Must not be in or have been in productive use at any time since at least 1 April 1998.
- Must not be able to be in productive use without the removal of buildings or other structures.