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Don’t miss out on valuable tax relief

5th October 2017

It is often overlooked by project managers and company finance directors that special tax relief is available to owners of land and buildings against the costs incurred for the removal of asbestos.

Introduced in the Finance Act 2001 as part of the government’s urban regeneration scheme, Land Remediation Relief means that 150% of the costs associated with asbestos remediation works on sites or any buildings or structure on that land can be claimed against a company profits as tax relief.
This also means that if a company makes a loss after the cost of work had been taken into account, then it can claim a tax rebate.

However, it is important to note that this concession does not apply if the building or land was owned by the company when the asbestos containing material was originally incorporated or imported. Also, the company must not receive any other form of subsidy or grant towards the asbestos removal costs.

Importantly, the full costs of any asbestos removal programme can be taken into account for tax relief purposes. This means that any professional fees, asbestos survey costs, air monitoring and analysis and any physical removal works can all be included in the tax relief calculation.

In addition, depending on specific circumstances, the costs of replacement materials required in any refurbishment after asbestos removal might also be eligible for inclusion in total project expenditure for tax relief purposes.

As a result, for an asbestos removal programme that costs, for example, £20,000 in total, then a company can deduct £30,000 from their final profits before corporate tax is calculated.

It follows that for those land and property owners faced with the responsibility of dealing with the presence of any asbestos containing materials, the potentially significant financial impact of the tax relief associated with remediation works can be a crucial factor in determining any action to be taken.

Of course, it is important to seek proper professional advice on the financial implications and potential tax relief linked to asbestos removal costs, but it is important that the opportunity to make what could be significant tax savings is not missed.

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