FEATURE
GREEN
TAXES
Mark Simpson, tax planning director at
specialist accountancy practise Simpson
Burgess Nash, believes those enterprises that
think and act greener will profit significantly.
In this article he outlines the hard economic
reasons for running an environmentally
friendly business.
T
he EU commission has released approach, and seek to establish a claim to
a 16 page Green Paper - what plant and machinery capital allowances The proposed new treatment would
other colour could it really be? - instead. It may or may not be possible for apply to such items as ‘Brise Soleils’ and
that outlines its vision on this to be retrospective, depending upon the ‘Active Facades’, used to provide a measure
reducing harmful emissions in specific circumstances. of passive solar heating in
the European Union. modern buildings.
ENHANCED CAPITAL ALLOWANCES
Targeted subsidies, tradable emissions (ECA)
rights and indirect taxation are all being An enhanced capital allowance is a CONTAMINATED LAND
used to cajole business to take real action 100% up-front tax deduction for investment Where a company (not a sole trade or
on environmental sustainability. Taxation is in designated energy saving and individual) incurs costs on remediating
seen as a key incentive, one that is environmentally beneficial plant and contaminated land, it can claim a 150%
preferable to regulatory initiatives as it machinery. Areas covered include: corporation tax deduction for the cost.
offers more flexibility, more compunction to
pursue technological innovation and is • Energy-saving plant and machinery The land (or buildings) must be in the
more effective in supporting employment - items include solar thermal UK, and must have been contaminated
with environmental objectives in mind. systems, combined heat and power, prior to acquisition (not by the purchaser!)
The European Union (EU) is serious in radiant and warm air heating. The Relief is available for employee,
making business greener - this is not a Energy Technology Criteria List, subcontractor and materials costs, and
publicity stunt or bureaucrats going through managed by the Carbon Trust on extends to asbestos removal.
the motions in Brussels. behalf of DEFRA, gives the full
To ensure that a real difference is made listing for tax relief. SUMMING UP
it has to meet business concerns bottom • Low CO
2
emission cars The EU wants “member states to find
line. It does. • Environmentally beneficial plant & the right balance between incentives and
I have outlined a selection of key machinery (water technology) - this disincentives.”
incentives on offer to business; (further tax covers a wide range of savings,
breaks are available for consumers). from efficient taps, toilets and In effect, those that continue polluting
showers to leakage detection will suffer economically with higher tax and
A BRIEF (BUT NOT equipment and vehicle wash waste those that implement greener ways of
EXHAUSTIVE) GUIDE TO reclaim units and much, much working will profit. This trend will become
WHAT IS ON OFFER FOR more. See www.eca-water.gov.uk/ more marked, we are only seeing the
BUSINESS? Full details of eligible items can be foundations of EU and governmental policy.
found on a dedicated website - It makes sense for all enterprises to take
THERMAL INSULATION OF www.eca.gov.uk/ note and then take advantage of what is
INDUSTRIAL BUILDINGS on offer.
This relief identifies expenditure on the ENVIRONMENTALLY BENEFICIAL
thermal insulation of industrial buildings as FIXTURES INTEGRAL TO BUILDINGS THE AUTHOR
plant for capital allowances purposes. This A number of such items are currently Mark Simpson is the tax planning
now becomes of particular importance, as regarded as part of the building for capital director at Simpson Burgess Nash a
the industrial buildings allowance (IBA) is allowances purposes and are thus ineligible specialist accountancy practice based in
being phased out, whilst capital allowances for capital allowances. The government is Manchester. The practice can advise clients
on plant will remain, albeit in a revised consulting, as part of its proposals to across the country about green taxes. Mark
form. Thus a business which has in the past amend the capital allowances system, on can be contacted on 0161 886 8062 or
claimed IBAs on such expenditure might including these as items eligible for the new mark.simpson@sbnca.com
now find it beneficial to reconsider that 10% allowance on integral fixtures.
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SUSTAINABLE FM | NOVEMBER 2007
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