Corporation Tax Act 2010 section 341

Activation of field allowance

Section 341 provides the rules for determining the amount of field allowance that can be activated in a given accounting period, once all the conditions for activation set out in section 340 have been met.

• When all activation conditions are satisfied, the field allowance for a particular oil field is activated by the amount of the company's adjusted ring fence profits for that accounting period attributable to the field.
• The amount activated in any period cannot exceed the company's remaining unactivated field allowance for that field at the start of the period — in other words, the initial allowance less any amounts already activated in earlier periods.
• Activation is a cumulative process: each period's activation reduces the balance of field allowance still available for future periods.
• These rules ensure that field allowance is used proportionally against actual profits from the relevant field, and cannot be activated beyond the total allowance originally granted.