Corporation Tax Act 2010 section 332FC

Carrying forward of unactivated allowance

Section 332FC sets out how any unused (unactivated) investment allowance relating to a qualifying oil field is calculated and carried forward to the next period.

• At the end of each accounting period, any unactivated allowance that has not been used or reduced is carried forward as investment allowance for the next period.
• The carry-forward amount is calculated as: closing unactivated allowance (U), minus activated allowance used in the period (A), minus any reduction required because the company disposed of equity in the oil field (T).
• If the result of U minus A minus T is greater than zero, that positive amount is treated as investment allowance held from the very beginning of the next period.
• The "next period" is either the company's next reference period for that oil field (if one follows immediately) or, failing that, the company's next accounting period.