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HMRC internal manual

Oil Taxation Manual

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HM Revenue & Customs
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PRT: Changes - FA93 - Other consequences of abolition-non-field expenditure

  1. Exploration and Appraisal Expenditure Relief is abolished, (subject to certain transitional arrangements), in respect of expenditure incurred on or after 16 March 1993 (see OT14040 - OT14080).
  2. Abortive Expenditure Relief does not now become due on the grounds that such expenditure will never be allowable for PRT (the test for S5 relief) if it relates to non-taxable fields. (See OT13560). S5 OTA 1975 was amended by FA94\S237 which provides that, in relation to S5(1)(c), for the purpose of determining whether expenditure is or is likely to become allowable for any oil field, it shall be assumed that any oil field which, apart from that subsection, would be a non-taxable field, is (or will be) a taxable field and therefore that FA93\S185(4)(e) does not apply.
  3. Research Expenditure Relief under S5B is amended so that research expenditure for purposes relating to a “non-taxable” field is disallowed in the same way as other expenditure for purposes outside the PRT charge (FA93\S185(4)(c), see OT14125).
  4. Unrelievable Field Losses Relief is not available in respect of any unrelievable field losses of “non-taxable” fields. (FA93\S185(4)(d)).
  5. Cross-Field Allowance (CFA) (OT13020 et seq) is not available in respect of expenditure on “non-taxable” fields. (FA93\S185(4)(e)).