Will Your Company get any Advantages from Asbestos Tax Relief?
The asbestos tax relief scheme says that the company can reclaim 150% of the asbestos remediation project costs as tax relief on their profits.
Asbestos had and still has a lot of advantages when it comes to building construction. Asbestos insulates buildings very effectively allowing energy efficiency. Asbestos sheets made of asbestos cement are very strong and durable with the added advantage of being able to withstand high temperatures of fire. Blue, brown and white asbestos (Crocidolite, Amosite and Chrysotile, respectively) had been used in construction in the 20th century buildings.
Cleaning and maintenance is easy, but repairing is very difficult, and the material itself is cost-effective. But it has been banned for construction purposes in the UK, since the turn of the millennium. And for good reason too.
Why was Asbestos banned in the first place?
Asbestos poses a serious health risk when used in construction. This is because asbestos consists of “microscopic particulates” or “fibers.” If these fibers are inhaled by anyone, they pose a serious risk of Mesothelioma and other diseases. This happens with continued exposure to these particulates over a substantial period of time. This includes homes as well as offices.
Mesothelioma, in particular, afflicts many individuals in the UK. The UK has one of the highest rates of the disease which is linked to the use of asbestos. During World War II, the UK’s shipbuilders widely used asbestos in the construction of sea-bound ships, many of which were for the armed forces. But the adverse health effects and rising Mesothelioma rates, led to a ban on asbestos’ use.
Responsibility of Company Owners to manage Asbestos
A business has priorities; satisfying clients, making profits, motivating employees and so on. Often, office maintenance gets overlooked amongst the more pressing priorities. If you’re a property owner, manager, surveyor, architect or even a tradesman, you will come into contact with asbestos sooner than you think.
Commercial property owners may be able to delegate the daily management of asbestos to a manager in their company. They can even outsource it. The legal responsibility is theirs and theirs alone. The Control of Asbestos Regulations of 2012 (CAR2012) binds them legally to manage asbestos. Therefore, company owners must make sure that whoever they assign to the daily asbestos management, they are vigilant in doing their jobs.
Asbestos Tax Relief for UK registered companies
The UK government had come up with a scheme to get rid of asbestos in buildings as far back as 2001. The Finance Act of 2001 includes an incentive for asbestos remediation projects for any companies registered in the UK who had asbestos construction in the building. If the company owned the building when initially constructed, with asbestos, this Asbestos tax relief is not applicable.
If a company is incurring losses due to asbestos remediation (which is legally binding on them to do), it can reclaim costs of the remediation.
If the asbestos remediation project costs £5000, the company can put £7,500 as a deductible on their taxable income. So they essentially make more profits. Companies can even get cash if they have made a loss.