Corporation Tax Act 2010 section 332DA

Restriction where field qualified for field allowance as new field

Section 332DA restricts the amount of investment expenditure on certain oil fields that can qualify for investment allowance, by reference to the field allowance the field originally received as a new field.

• Expenditure on a new oil field authorised before 1 January 2016 only generates investment allowance once cumulative spending attributable to a company's equity share exceeds a threshold equal to 160% of the original field allowance multiplied by that equity share.
• Cumulative relevant expenditure is measured from 1 April 2015 or the field's authorisation day (whichever is later) and is adjusted for any disposals or acquisitions of equity in the field.
• The restriction ceases to apply once the relevant national authority (the OGA, or the Welsh Ministers for wholly Welsh onshore fields) determines that the development project has been materially completed.
• The restriction does not apply where a non-licensee company incurs expenditure making an asset available in return for tariff or tax-exempt tariffing receipts, nor does it apply to expenditure already caught by the separate restriction for additionally-developed oil fields.