Investment Allowance and Cluster Area Allowance reduce the adjusted ring fence profits of oil and gas companies which are subject to the supplementary charge by an amount equal to 62.5% of investment expenditure incurred.
In the Summer Budget 2015, the government announced that the the definition of investment expenditure would be extended for the purposes of the Investment and Cluster Area allowances.
HM Revenue and Customs is seeking comments on the draft legislation by 27 January 2016.
A tax information and impact note has also been published.
Any comments on this draft should be sent to:
HM Revenue and Customs
100 Parliament Street