Print

Provisions introduced in 2015 allow businesses to receive tax relief for expenses incurred on contributions made to Flood and Coastal Erosion Risk Management (FCERM) projects.

Flood and Coastal Erosion Risk Management project relief

Where the conditions are met contributions to an FCERM are deductible for Income Tax or Corporation Tax purposes.

Conditions

Tax relief is given to a person (the contributor) who incurs expenses in making contributions to a qualifying FCERM project and these expenses would not otherwise be tax-deductible.

Contribution means a sum of money paid or any services provided in the accounting period.

Qualifying projects

A Flood or Coastal Erosion Risk Management project is a qualifying project if:

A contribution to an FCERM project is a qualifying contribution if the contribution is made for the purposes of the project and under an agreement between:

Anti-avoidance: Disqualifying benefits

No tax relief is given if the contributor or a connected person receives, or is entitled to receive a 'disqualifying benefit'.

Refunds and compensation

If a contribution is made to an FCERM and the contributor or a connected party receives a cash refund or, in the case of a contribution by way of a provision of services, receives compensation in money or money’s worth:

Small print

This tax relief is similar to the relief in section 82 ITTOIA 20015 and section 82 CTA 2009 “Contributions to local enterprise organisation or urban regeneration companies”.

Income Tax

Sections 86A and 86B ITTOIA 2005 with a reference to those sections in section 272 (application of trading income rules to property business).

Corporation Tax

Sections 86A and 86B CTA 2009 (trading income), Sections 1244A and 1253A (companies with investment business) and adjustment to table in section 210 (application of trading income rules to property business).