No reduction of allowable expenditureU.K.
3(1)Paragraph 8 of Schedule 1 to OTA 1983 (allowable expenditure: use of new asset otherwise than in connection with taxable field) is amended as follows.U.K.
(2)In sub-paragraph (1)(a) and (b), for “in connection with a taxable field” substitute “ for a qualifying purpose ”.
(3)After sub-paragraph (2) insert—
“(2A)In sub-paragraph (1) a reference to use for a qualifying purpose is a reference to—
(a)use in connection with a taxable field, and
(b)other use in—
(i)the United Kingdom,
(ii)the territorial sea of the United Kingdom, or
(iii)a designated area,
except use wholly or partly for an ineligible oil purpose.
(2B)In this Act a reference to use of an asset for an ineligible oil purpose is a reference to—
(a)use in connection with an oil field that is not a taxable field, and
(b)use for any other purpose (apart from a purpose falling within section 3(1)(b) of the principal Act) of a separate trade consisting of activities falling within section 492(1) of the Income and Corporation Taxes Act 1988.
(2C)In sub-paragraphs (2A) and (2B) a reference to use in connection with a taxable field or other oil field includes use giving rise to receipts which, for the purposes of this Act, are tariff receipts.”