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HMRC internal manual

# Transferable Tax History - Tracking of multiple holdings of the same asset containing TTH

TTH will relate to a specific TTH election for a specific TTH asset from a specific seller.  Therefore, profit tracking for each interest of the same asset purchased separately, must be kept separate and cannot be pooled.

The example below shows how this works:

Company A holds 20% of field X

Company B holds 25% of field X,

Company C holds 15% of field X

the rest is held by four other participators each holding a 10% stake.

Company B purchases Company A’s share of field X with TTH on 31 January 2019. From that date Company B must track the profits from the purchased 20% interest in field X.

On the 31 January 2020, Company B then purchases Company C’s share of field X along with TTH. At this point it will be a requirement for Company B to track profits from both the acquired interests separately but it does not need to track profits from its original 25% interest because it will not have any associated TTH.

When it comes to activation of the TTH for Company B when decommissioning expenses occur in the same field they should be set off against tracked profits pro-rata based on the percentage holding.

In the example above 25/60ths of the decommissioning costs of the company representing the original holding is disregarded for TTH activation purposes.

20/60ths of the decommissioning costs go against the profits tracked for the 20% field interest purchased from Company A.

15/60ths goes against the 15% field interest purchased from Company C.

It is intended this will look as follows if the total decommissioning cost of the company is £10,000 :

Field interest TTH transferred TNTP Portion of decom costs TTH activated
25% nil n/a 25/60 x 10,000 = 4,167 nil
20% from Co A 2,500 1,200 20/60 x 10,000 = 3,333 3,333 - 1,200 = 2,133
15% from Co C 1,750 750 15/60 x 10,000 = 2,500 2,500 - 750 = 1,750
Total 60% 4,250 1,950 10,000 3,883