Part 1The Civil Nuclear Industry

Chapter 1Nuclear decommissioning

Financial provisions

I130Disregard for tax purposes of provisions recognised by NDA

1

This section applies where—

a

by virtue of a direction under section 3 the NDA acquires the responsibility for securing the cleaning-up of a site falling within subsection (2), or the decommissioning of an installation or facility in or on such a site;

F2b

that responsibility—

i

includes the financial responsibility under section 21, or

ii

would do so but for the fact that the amount of the financial responsibility is for the time being subject to a limit imposed by a capping agreement;

c

F6... the NDA recognises in its accounts, in accordance with generally accepted accounting practice, a relevant provision that relates to that responsibilityF1; and

d

the provision is recognised—

i

in order to reflect the coming into force of the direction mentioned in paragraph (a), or

ii

in consequence of the variation or removal of a limit on the NDA 's financial responsibility under section 21 imposed by a capping agreement.

2

A site falls within this subsection if—

a

at the time the direction mentioned in subsection (1)(a) comes into force there is a nuclear site licence in force in relation to the site; and

b

the holder of that licence at that time is a BNFL company that is publicly owned.

F33

In computing the profits, gains or losses of the NDA for the purposes of corporation tax, no amount shall be brought into account in connection with—

a

the recognition made in the accounts of the NDA of—

i

the relevant provision, or

ii

an asset that, in accordance with generally accepted accounting practice, is recognised in order to reflect a limit on the NDA 's financial responsibility under section 21 imposed by a capping agreement;

b

any adjustment made in those accounts (including the removal from the accounts of an asset falling within paragraph (a)(ii)) in consequence of a variation or removal of the limit mentioned in paragraph (a)(ii).

4

But subsection (3) shall not affect the amount (if any) to be brought into account in computing the profits, gains or losses of the NDA in connection with F4an adjustment not falling within paragraph (b) of that subsection.

5

In this section—

  • “BNFL company” means BNFL or a wholly-owned subsidiary of BNFL;

  • F5“capping agreement” has the same meaning as in section 29;

  • “relevant provision” means F7any amount retained as reasonably necessary for the purposes of providing for any liability or loss which is either likely to be incurred, or certain to be incurred but uncertain as to amount or as to the date on which it will arise.

6

This section is to be construed as one with the Corporation Tax Acts.