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HMRC internal manual

Oil Taxation Manual

HM Revenue & Customs
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Capital allowances: extended ring fence expenditure supplement for onshore activities - post-commencement pools - reductions in respect of unrelieved group ring fence profits


If, after making reductions in respect of utilised onshore ring fence losses (OT26270), there are unrelieved group ring fence profits for a post-commencement period then the remaining amount in the onshore ring fence pool is reduced by the amount of the unrelieved group ring fence profits of the period (CTA2010\S329S(2)). Where these unrelieved profits exceed the amount in the ring fence pool then the amount in the pool is reduced to nil, but the pool continues in existence (CTA2010\S329Q(2)).

In the case of a straddling period the unrelieved group ring fence profits for that period are to be determined as if the period began on 5 December 2013 and ended at the same time as the straddling period.

If the ring fence trade carried on by the company includes, or has at any time included, offshore oil-related activities, the sum to be set against the onshore ring fence pool under S329O(2) is first to be reduced by the notional offshore loss pool.

The notional offshore loss pool is the sum of the relevant offshore losses (S329R(4)) for the period and earlier post-commencement periods, less the sum of any amounts treated as used under S329R(3) and then less any reductions previously made under S329O(2).