Corporation Tax Act 2010 section 301

Effect of repayment of PRT: special rule

Section 301 provides a special rule for adjusting corporation tax when petroleum revenue tax (PRT) is repaid as a result of carried back losses, overriding the general rule in section 300.

• When PRT that was previously deducted under section 299(2) is repaid because of a carried back loss under Schedule 2 to OTA 1975, the general repayment rule in section 300 is switched off and this special rule applies instead.
• The amount of the "appropriate repayment" must be added back to the company's income from oil extraction activities or oil rights for the accounting period in which the loss that triggered the repayment actually arose, rather than the period in which the repayment itself is received.
• Where two or more carried back losses from different chargeable periods together give rise to the repayment, the appropriate repayment is apportioned across the relevant accounting periods as though each loss had been relieved by a separate assessment, with earlier losses treated as relieved first.
• HMRC may raise any additional corporation tax assessment needed to reflect this add-back at any time up to four years after the end of the calendar year in which the PRT repayment is made.