Relief for investment expenditure
I12Additional expenditure treated as incurred for purposes of section 1
1
This section applies for the purposes of section 1 if, in a qualifying accounting period, a company has incurred investment expenditure.
2
Expenditure is “investment expenditure” so far as—
a
it is capital expenditure, operating expenditure or leasing expenditure,
b
it is incurred for the purposes of oil-related activities,
c
it is not incurred for disqualifying purposes, and
d
it does not consist of financing costs or decommissioning costs.
F13
For the purposes of section 1 the company is to be treated as if, in addition to the investment expenditure (“the IE”) incurred by it in the accounting period, it had incurred in that period—
a
expenditure of an amount equal to 80% of the amount of the IE, in a case where the expenditure is capital expenditure on the de-carbonisation of its upstream petroleum production, and
b
expenditure of an amount equal to 29% of the amount of the IE, in any other case.
4
For the purposes of this section, if investment expenditure is incurred partly for the purposes of oil-related activities and partly for other purposes, the expenditure is to be attributed to the oil-related activities on a just and reasonable basis.
F24A
For the purposes of this section, where a company incurs expenditure part of which is capital expenditure on the de-carbonisation of its upstream petroleum production and part of which is not, the expenditure is to be apportioned on a just and reasonable basis.
5
This section needs to be read with section 6 (which prevents recycling etc of assets to generate relief).