The guidance on tax breaks for cleaning up contaminated land and buildings provided by Davis Langdon Crosher and James in the infrastructure cost model (28 April, page 65) contained a couple of misleading statements that I would like to correct.
First, the benefit of land remediation relief for investors is not about the timing of tax savings; more importantly, it allows savings to be enjoyed for expenditure that would otherwise not attract any tax relief at all (because it is not a tax-deductible trading expense and would typically qualify for capital allowances).
Second, although developers may go back six years to claim retrospectively (under the general time limit for making tax relief claims), it is wrong to imply that investors cannot do this. Investors have two years to make the written election required to claim a tax deduction for capital expenditure on land remediation. However, if this deadline is missed (which is not recommended), the fallback remains for an investor to make an "error or mistake" claim, which has a six-year deadline.
Steven Bone, partner, the Capital Allowances Partnership