The Corporation Tax (Land Remediation Relief) Order 2009

EXPLANATORY NOTE

(This note is not part of the Order)

Sections 1143 to 1179 of the Corporation Tax Act 2009 (c.4) contain re-written provisions relating to Land Remediation Relief. Section 26 to, and Schedule 7 of, the Finance Act 2009 (c.10) amend these provisions and create powers, which are being exercised in this Order.

This Order will have retrospective effect as it applies in relation to qualifying expenditure in relation to Land Remediation Relief incurred on or after 1st April 2009.

Article 2 sets out the meaning of arsenic, arsenical compounds, Japanese Knotweed and radon.

Article 3 provides that section 1145(2) (land “in a contaminated state”) does not apply to arsenic, arsenical compounds, Japanese Knotweed and radon so that land may be “in a contaminated state” for the purposes of section 1145 by reason of the presence in, on or under it of arsenic, arsenical compounds, Japanese Knotweed and radon. The dis-application is limited so that it applies only to that part of the land where one of the listed substances is present and applies only in relation to expenditure incurred for the purposes of remedying the effects of relevant harm caused by the presence of one of the listed items.

Article 4 provides that for the purposes of section 1146(3A)(a) (“relevant contaminated land remediation”) the removal of material which contains or may contain Japanese Knotweed from the land in question to a licensed landfill site is a specified activity that is not relevant contaminated land remediation under section 1146.

Article 5 sets out a list of enactments. Activities required by or by virtue of any of these enactments are not relevant contaminated land remediation under section 1146.

Article 6 specifies purposes falling within Condition B in section 1146A(3) (“relevant derelict land remediation”). Condition B is one of the conditions that must be met if an activity is to amount to relevant derelict land remediation for the purposes of the section.

Article 7 provides that the conditions in section 1147(3)(a) (deduction for capital expenditure) and 1149(3)(a) (additional deduction for qualifying land remediation expenditure) need not be met where land is in a contaminated state by reason of the presence of Japanese Knotweed. This removes for those cases where land is in a contaminated state by reason of the presence of Japanese Knotweed the condition that all or part of the land was in a contaminated state at the time of acquisition.

A full impact assessment has been produced for this instrument. It can be located at http://www.hmrc.gov.uk/ria/land-remediation-relief.pdf.