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HMRC internal manual

Oil Taxation Manual

HM Revenue & Customs
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Non-Residents Working on the UK Continental Shelf: Scope of Exploration or Exploitation Activities - Meaning of “designated area”

This term is defined in CTA09\S1313(3), ITTOIA05\S874(2) and ITEPA03\S41(2) as “an area designated by Order in Council under Section 1(7) of the Continental Shelf Act 1964”. Broadly speaking the designated areas stretch from the outer edge of the UK Territorial Sea to median lines mutually agreed between the UK and neighbouring countries or (if further) out to the 200 mile limit. Such areas are identified in various maps of the UK, including those appearing on the Department of Energy and Climate Change website which can be found at The phrase United Kingdom Continental Shelf is frequently used in the trade press and takes the same meaning as “the designated areas”. UK Continental Shelf is therefore used with that meaning in this Manual.

As indicated at OT40550:

Any activities carried on in the UK Territorial Sea are treated for tax purposes as performed in the UK;

Only some activities carried on in the designated areas are so treated, namely those falling within the definition of “exploration or exploitation activities” (see OT40600).

No activities performed outside the limit of the designated areas are within UK tax jurisdiction under CTA09\S1313, ITTOIA05\S874 or ITEPA03\S41, even if they satisfy the “exploration or exploitation activities” definition.