We have recently had significant success advising on Mineral Extraction Allowances (MEAs) claims. This highly lucrative tax incentive is available for capital expenditure incurred in connection with mineral extraction; typically in the mining and/or quarrying industries.

Given the specialist nature and huge complexity of the MEA regime, it’s likely that many companies are failing to spot this opportunity. A few companies have simply overlooked the relief as it tends not to be widely publicised. Some potential claimants are even unaware that they are in fact carrying on qualifying activities. Whilst the claimant must be carrying on a “mineral extraction trade” we have come across some situations where the mining or quarrying company has still managed to access the relief; despite not owning the land.

MEAs are particularly valuable given that the conditions for qualifying expenditure cover expenditure which would typically not qualify for any type of UK corporation tax deduction. For example, infrastructure capital expenditure on the construction of roads and tunnels, site restoration costs and similar items do tend to qualify for MEAs.

On some occasions we have identified that even although MEAs were not available on the full amount of the capex spend, we were still able to help unlock valuable capital allowance claims on processing, plant, machinery and fixtures.

We are currently helping our clients to reduce their tax bills, where their activities include sand & gravel extraction, hard rock mining and in the field of geothermal energy. Our team have strong experience of pulling together large MEA claims. Our clients in this sector have been delighted with our proactive approach in this highly specialist area.

To find out if your company may qualify for MEA tax relief, or to discuss any of the points raised in this blog please get in touch with me here, or:

0141 886 6644
mark.pryce@campbelldallas.co.uk

The information in this blog should not be regarded as financial advice.  This is based on our understanding in December 2016. Laws and tax rules may change in the future.