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The road to Germany 2006 : 12.10.05 The Cognition support team enjoyed a great night at Old Trafford to see England confirm qualification for next years World Cup Finals at the top of their group.
The pictured team all wore newly acquired England shirts (other than an Irishman and a Scotsman) and after a couple of beers to wash down a pizza, headed to off to the ground by coach. Everyone was in good voice on the journey and remained so throughout an encouraging England performance.
After the game, Joanne Pearson lead an assault on Rusholme, to the curry mile, for more beer and of course the necessary late night curry. Roll on the summer of 2006..come on England! Scottish Football Update... Not the World Cup : 18.09.05 The Cognition sponsored boys football team are doing well again. They are 2nd in the under 13 Scottish Eastern Youth League at present having lost three drawn one and won six. The top scorers are Tinashe Mukundwa with 16 goals and Liam O Donnell with 13.
The club even expect to have their own website shortly to keep their fans and sponsors well informed. McAlpine have now supplied the training kit to add to the Cognition playing strip and shirt deal. Advertising space around the home pitch is also available to any further willing parties.
Good luck boys, keep it up, your country needs you! Boston Rowing Marathon : 18.08.05 A Cognition rowing team raised over a thousand pounds for Cancer charities at the Boston Rowing Marathon. The team was of mixed experience with commonwealth gold medallist and complete beginners alike.
The Boston Rowing Marathon is an annual head of the river race run over a 31 mile course on the River Witham between Lincoln and Boston (England).
The course was first rowed in 1946 (see newspaper story) as a private challenge for a coxed four from Boston Rowing Club. The race now attracts in excess of 150 entries from clubs across the United Kingdom and Europe. Little Britain Challenge Cup : 11.08.05 This years Little Britain Challenge Cup, the construction industry sailing regatta, was again a huge success for both the organisers and Cognition. The event raised more than £100,000 for the Jubilee and Cirdan Sailing Trusts and Cognition took an impressive two further trophies to add to the five won in earlier years. We took second place overall in our class and finished the highest placed boat including 50% female crew. Our team also finished second overall in the Project Managers category winning a fine bottle of malt whisky for our performance.
As already the largest annual corporate regatta in Europe the attendance this year grew further still, attracting 239 competing yachts, their crews and supporters.
The event offers the opportunity to mix with construction industry colleagues, and for Cognition the chance to meet clients also taking part under somewhat different circumstances to normal. We also able to enjoy a fantastic team sport and help raise a staggering sum for worthwhile charities.
During the evenings proceedings we were able to see new videos showing first hand how the charities are able to help disadvantaged, disabled or ill people through their involvement with sailing. It was heart warming to see the work carried out and the resulting effect for all concerned.
This year was a first for the Cognition team to experience the Racing as opposed to Cruising category, the difference being the use of a spinnaker. A simple difference but nonetheless a significant one increasing the skill and teamwork involved and also the responsibility put on the skipper. Tim Thuberon took the role for us for the third year running and once again was forced to climb the mast mid race, this time to retrieve the blown spinnaker halyard. Without doubt the incident cost us time, perhaps even first place overall instead of the very credible second.
Without doubt we’ll be back again next year in search of that elusive first place. Tax incentives for contaminated land: 02.07.05 A tax relief for the remediation of contaminated land was introduced in the 2001 budget. Where the rules were satisfied, expenditure incurred after 10th May 2001 on remediation received preferential treatment for tax purposes.
An extra 50% is added to the expenditure for the purposes of the tax deduction. A company spending £100,000 on cleaning up land is treated for tax purposes as if it had spent £150,000. Put another way, if it is subject to corporation tax at the full rate of 30%, it effectively gets relief for remediation work at a rate of 45%.
Where the expenditure would normally be on capital account, for example in the case of a property investor, or a trader using the land for its own premises, then relief for the clean up cost is available as it is incurred. (Normally such expenditure would only be allowable when the property is sold, perhaps many years hence). In addition, the 50% “bonus” applies here also.
If You Are A UK Tax Paying Company But Not A Polluter?
1 Main features
A new tax relief for the remediation of contaminated land was introduced in the 2001 Budget. Where the rules are satisfied, expenditure incurred after 10 May 2001 on remediation receives preferential treatment for tax purposes.
There was initial concern that the relief would not apply to property developers. However, it has now been confirmed that developers can obtain this relief, as well as those holding land either as an investment or for the purposes of their own trade.
The two main consequences are:
An extra 50% is added to the expenditure for the purposes of the tax deduction. A company spending £100,000 on cleaning up land is treated for tax purposes as if it had spent £150,000. Put another way, if it is subject to corporation tax at the full rate of 30%, it effectively gets relief for remediation work at a rate of 45%.
Where the expenditure would normally be on capital account, for example in the case of a property investor, or a trader using the land for its own premises, then relief for the clean-up cost is available as it is incurred. (Normally such expenditure would only be allowable when the property is sold, perhaps many years hence.) In addition, the 50% "bonus" applies here also.
As with most tax reliefs, there are many rules, traps and opportunities. The following is a summary of the main rules. Specific advice should be taken for each situation.
2 Summary of rules
2.1 The relief is only available to companies: not individuals, partnerships or trusts.
2.2 The company must acquire the land in a contaminated state. It is important that the company obtains an interest in the land (which may be freehold, leasehold, a license or an option). Expenditure prior to acquisition can qualify provided that acquisition follows.
2.3 The expenditure that qualifies is broadly the extra cost, as compared with the cost if there had been no contamination. Ordinary site preparation expenditure does not qualify, but assessment costs can qualify.
2.4 It is not necessary to remove the polluting material. Treatment on site can qualify.
2.5 Where remediation work is carried out in-house, relief is limited to employee and material costs. There are detailed rules for what may be included in employee costs, in terms of salaries, national insurance contributions, and pension contributions. The relief covers all or part of the cost of employees and directors who are directly engaged in remediation work for at least 20% of their time. The cost of administrative and secretarial staff cannot be claimed.
2.6 Where remediation work is sub-contracted, the position is simpler and more generous: the full cost of paying the sub-contractor for remediation work can be claimed, without reference to the actual employee or material costs. This means that, in effect, the sub-contractor's administrative overheads, haulage and other costs, and profit margin all qualify for relief.
2.7 The above only applies however where the sub-contractor is independent. There are further rules covering a sub-contractor within the same group, broadly along the lines of in-house work.
2.8 Relief is restricted where the cost is offset by grants or subsidies, or met by other persons. This may be an issue where a payment is made under warranties or indemnities.
2.9 It is essential that the company that acquires the property does not add to the contamination, either by action or inaction. If it does, it could be disqualified. This is potentially a harsh rule, as even a brief delay in dealing with a continuing cause of contamination could mean that all relief is lost. It is therefore important to act quickly to prevent the condition worsening.
2.10 The rules also preclude relief if the contamination took place while the land was in the hands of a connected party. This can mean that it is inadvisable to buy the shares of the company which holds the land, even if the contamination took place long ago: it may be better just to buy the land. There are of course many other tax, legal and commercial issues to consider on an acquisition. Where it is commercially necessary to buy the shares, planning techniques may be available to ensure that the relief is not lost.
2.11 The timing of relief may be when the expenditure is incurred, or (particularly in the case of a developer) when the cost is deducted in the accounts. An investment company may obtain relief more quickly than a developer.
2.12 Where a company cannot make use of the relief, because it has excess tax losses, then it can instead apply to the Revenue for a cash payment of 24% of the qualifying expenditure. This compares to an effective 45% tax relief for a company subject to the full rate of corporation tax. In most cases it will be better to carry forward tax losses and get the eventual benefit at 45%; but 24% in cash may be attractive where there are cash flow concerns.
2.13 There are special rules for life assurance companies, and anti-avoidance provisions.
2.14 The corporation tax relief should be distinguished from the landfill tax exemption for contaminated materials. They will often both apply in the same situations, but have different sets of rules.
3 Key definitions
3.1 Contamination is defined widely. It is necessary to identify "substances" in, on or under the land, as a result of which "harm" is being caused or there is a possibility of harm being caused; or pollution of controlled waters is being, or is likely to be, caused. Nuclear sites are however excluded.
3.2 Substance means any natural or artificial substance, whether in solid or liquid form or in the form of a gas or vapour.
3.3 Harm means harm to the health of living organisms, interference with the ecological systems of which any living organisms form part, offence to the senses of human beings, or damage to property.
3.4 Pollution of controlled waters means the entry into controlled waters of any poisonous, noxious or polluting matter or any solid waste matter.
3.5 Land includes the buildings on the land (so for example the removal of asbestos within buildings would qualify).
There remain some grey areas, for example contamination by noxious plants such as knotweed, or by insects such as termites. Generally however, the definitions will cover most types of contamination.
4 Observations
Tax planning, combined with an environmental survey, is strongly advised to get the most out of this relief.
Companies disqualified from claiming the relief themselves, for example because the land has been contaminated while in their ownership, need to be aware of the rules when negotiating a sale. The benefit of tax relief may be reflected in the price, especially where the price is discounted for contamination.
Companies seeking to obtain the relief need to take care to avoid a number of tax traps, and to maximise their opportunities for relief. |
