Corporation Tax Act 2010 section 356NE

Losses

Section 356NE restricts the ability of oil contractors to set off losses arising outside their ring fence activities against their ring fence profits.

• Trade losses can only be relieved against ring fence profits if they arise from oil contractor activities
• This restriction applies both to current year loss relief and to the carry forward of post-1 April 2017 trade losses against total profits
• Losses from non-trading intangible fixed assets, UK property businesses, and excess carried forward non-decommissioning ring fence trade losses cannot be set against ring fence profits at all
• The rule ensures that only losses genuinely connected to oil contracting work can reduce the contractor's ring fence profits