Part 8Oil activities

F1CHAPTER 5AExtended ring fence expenditure supplement for onshore activities

Annotations:
Amendments (Textual)
F1

Pt. 8 Ch. 5A inserted (with effect in accordance with Sch. 14 para. 4 of the amending Act) by Finance Act 2014 (c. 26), Sch. 14 para. 1

Post-commencement additional supplement

329RReductions in respect of utilised onshore ring fence losses

1

If one or more losses incurred by a qualifying company in its ring fence trade in a post-commencement period are used under section 45 (carry forward of trade loss against subsequent trade profits) to reduce any profits of a post-commencement period, a reduction is to be made in that period in accordance with this section.

2

To the extent that the losses used as mentioned in subsection (1) are onshore ring fence losses, the amount in the onshore ring fence pool is to be reduced (but not below nil) by setting against it a sum equal to such amount of those onshore ring fence losses as is so used.

3

For the purposes of determining the extent to which losses used as mentioned in subsection (1) are onshore ring fence losses, relevant offshore losses are to be treated as so used in priority to onshore ring fence losses.

4

For this purpose “relevant offshore loss” means so much (if any) of a loss used as mentioned in subsection (1) as is given by—

where—

X is the amount of the loss so used, and

Y is so much of that loss as (ignoring section 329P(4)) is an onshore ring fence loss.

5

In the case of a loss incurred in a straddling period—

a

the amount of the relevant offshore loss is apportioned between so much of that period as falls before 5 December 2013 and so much of it as falls on or after that date, on the basis of the number of days in each part, and

b

only so much of the loss as is apportioned to the later part of the period is a relevant offshore loss of the company for the straddling period.

6

But if the basis of the apportionment in subsection (5)(a) would work unjustly or unreasonably in the company's case, the company may elect for the apportionment to be made on another basis that is just and reasonable and specified in the election.