All You need to know About Asbestos Tax Relief in the UK
We all know that asbestos is one of the most toxic yet useful substances on the planet. You may also know that asbestos was widely used in construction during the 20th century in homes and buildings. What you may not know is that there is a duty to manage asbestos in office and home buildings. For businesses, there is sometimes a 150% asbestos tax relief on the costs of an asbestos removal project.
The Control of Asbestos Regulations of 2012 clearly define the responsibilities of those in charge of asbestos management in the building. The buildings that fall under the category are all types of industrial or commercial buildings. Factories, restaurants, warehouses, hotels, hospitals schools and public buildings are included. Common areas of domestic buildings such as a residential flat’s foyer, lift, outhouse, garages, gardens and roofs are also included among the areas where asbestos management is needed.
The extent of the responsibility to clean up asbestos may vary. Typically, the owner is responsible for it, although an asbestos management consultant may be delegated the task. A tenant agreement may also decide who is to be given the responsibility. Tenants may be responsible of their own areas. Owners may have shared responsibilities as well.
Responsibilities of Asbestos Management
Some of the responsibilities in asbestos management in non-domestic premises for the individual responsible include:
- Finding out if there are any ACMs (Asbestos Containing Materials) on the premises. If there are, finding out how much is there and what its condition is.
- Assuming that there is asbestos in the material unless there is substantial proof otherwise, Maintaining updated records of asbestos containing materials (with assumed ACMs as well) complete with their condition and location
- Doing a risk assessment of the exposure of the occupants to the known ACMs
- Coming up with a plan to detail the management of these ACMs
- Disbursing the information about where ACMs can be found and what their condition is to those likely to come into frequent contact with it
- Putting the asbestos management plan into action and updating it appropriately with a system of monitoring and feedback/review.
Asbestos Tax Relief
At times, the above responsibilities can take a toll on the profits of a company. To that effect, the UK government has come up with a 150% tax relief system where the substantial costs of asbestos remedial may be offset by 150% deduction from taxable profits. That is to gain 1.5 times the amount spent on the removal in net profits. For example, if the cost comes out to be £100,000, £150,000 can be claimed as tax relief. Part of reclaimed costs may include professionals’ fee, survey and preliminary fees as well.
But certain criteria needs be met in order for individuals to qualify:
- The company where the asbestos remedial project was undertaken should be registered in the UK.
- They must be a corporation tax payer
- They shouldn’t be responsible for the first installation of the building
- Not applicable if the cost can be accommodated in for capital allowances, e.g. a panel replacement that can count as maintenance.
- Also inapplicable on roof, wall cladding and other asbestos cement products on environmental preservation areas. This is because the asbestos management plan is required by law to update these products due to deterioration in condition.
If you wish to benefit from the tax relief, then contact your tax advisor and an asbestos management company.