What is the purpose of section 10 of the Energy (Oil and Gas) Profits Levy Act 2022?

Section 10 is a signposting provision that introduces Schedule 1 of the Act. It directs the reader to the detailed rules governing how companies subject to the Energy Profits Levy can claim relief when they incur qualifying losses, rather than containing any substantive rules or calculations itself.

What is a qualifying levy loss under the Energy Profits Levy?

A qualifying levy loss is a loss incurred by an oil and gas company for the purposes of the Energy Profits Levy that meets the specific conditions defined in the Act. Not all losses are automatically eligible — the loss must satisfy particular criteria laid down in the legislation to qualify for relief.

How can qualifying levy losses be relieved under the Energy (Oil and Gas) Profits Levy Act 2022?

Schedule 1 of the Act, introduced by section 10, sets out the detailed mechanics for relieving qualifying levy losses. This may include carrying the loss forward to set against future levy profits. The schedule also specifies any time limits, restrictions, or procedural requirements that apply to the relief.

Which companies does the qualifying levy loss relief apply to?

The relief applies to oil and gas companies operating in the United Kingdom and on the UK Continental Shelf that are subject to the Energy Profits Levy. Where such a company's activities result in a loss rather than a profit for levy purposes in a given period, it may claim relief under Schedule 1.

Energy (Oil and Gas) Profits Levy Act 2022 section 10

Relief for qualifying levy losses

Section 10 introduces Schedule 1 of the Act, which sets out the rules for how companies can claim relief when they incur qualifying losses for the purposes of the Energy Profits Levy.

Section 10 is a signposting provision that directs the reader to Schedule 1 of the Act for the detailed rules on qualifying levy loss relief.
Schedule 1 contains the substantive provisions governing how losses arising under the Energy Profits Levy can be relieved against levy profits.
The relief applies specifically to "qualifying levy losses," meaning losses that meet the criteria defined elsewhere in the Act for the purposes of the levy.
This section ensures that oil and gas companies subject to the levy have a mechanism to obtain relief where their activities generate losses rather than profits in a given period.

Access full legislation.And much more.

By becoming a member, your team gets full access to Tax World research tools and source-backed tax resources.

Become a member