Find out how the supplementary charge is calculated on ring fence profits and when it must be paid.
What the supplementary charge is
The supplementary charge is an additional charge on a company’s ring fence profits.
From 1 January 2016 the rate of supplementary charge is 10%.
Calculating the charge
The supplementary charge is calculated in the same way as for Ring Fence Corporation Tax (RFCT) but without deductions for financing costs.
The supplementary charge is paid at the same time as RFCT.
New fields may qualify for ‘field allowances’ that can be set against profits when calculating the supplementary charge.
Further allowances were introduced from 1 April 2015:
Qualifying fields are :
- small fields
- ultra heavy oil fields
- ultra high pressure/high temperature fields
- remote deep water gas fields
You can find detailed guidance on the supplementary charge in the Oil Taxation Manual.