Corporation Tax Act 2009 section 1147

Deduction for capital expenditure

Section 1147 allows companies to claim a tax deduction for capital expenditure incurred on remediating contaminated or derelict land, provided certain conditions are met and the company elects for the relief.

• A company that acquires a major interest in contaminated or derelict land in the UK for the purposes of a property business or trade may claim a deduction for qualifying capital remediation expenditure, subject to meeting three conditions and making a formal election.
• The land must have been contaminated at the time it was acquired, or derelict continuously since the earlier of 1 April 1998 or the date the company (or a connected person) first acquired an interest in it.
• The relief allows the capital expenditure to be deducted in calculating the profits of the property business or trade for the accounting period in which it is incurred, including expenditure incurred before the business or trade actually begins.
• Relief is not available for expenditure that has already attracted capital allowances under other provisions, although expenditure eligible for structures and buildings allowances is not excluded.