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HMRC internal manual

Corporate Intangibles Research and Development Manual

Land Remediation Relief: Tax Credit: Qualifying land remediation loss - example

This example should be read together with the guidance at CIRD68005 and CIRD68015.


A Ltd is carrying on a trade and incurs qualifying land remediation expenditure of £50,000 in an accounting period. The expenditure is an allowable deduction in computing its trading loss for CT purposes. In addition A Ltd claims land remediation relief of £25,000 in respect of the expenditure.

After taking other expenses into account, A Ltd has an overall trading loss for the accounting period of £80,000. The company has other income of £10,000 in the accounting period.

A Ltd makes a claim to surrender the full amount of its qualifying land remediation loss in exchange for a payment of land remediation tax credit, but makes no other loss relief or group relief claims for the period:

* 150% of the qualifying land remediation expenditure is £75,000 (£50,000 x 150%).
* A Ltd’s unrelieved trading loss for the accounting period is £70,000 (£80,000 less £10,000).
* A Ltd’s qualifying land remediation loss is the lesser of these two amounts, i.e. £70,000.
* The tax credit payable is £11,200 (£70,000 x 16% see CIRD68015).
* The trading loss A Ltd is able to carry forward to future accounting periods is £10,000 (£80,000 less £70,000).