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HMRC internal manual

Oil Taxation Manual

HM Revenue & Customs
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PRT: Safeguard - Supplement

Supplement in Safeguard, FA81\S111

Supplement is due on all qualifying expenditure incurred prior to the end of the net profit period (NPP), see OT12650. It is therefore possible for PRT liability to arise in the NPP itself and therefore for a safeguard reduction to apply in that period. Allowance of supplement in the NPP has two effects, namely

  1. an increase in the accumulated capital expenditure at the end of the chargeable period by the amount of qualifying expenditure allowed,
  2. an increase in the adjusted profit following the ’add back’ of the qualifying expenditure together with related supplement.

Any benefit to be gained from (a) may be more than offset by the disadvantage of (b).