Oil Taxation Act 1975 section Sch 2 para 13F

Contract settlements

Paragraph 13F explains how claims for overpaid petroleum revenue tax are handled when the payment was made under a contract settlement, and particularly where the person who made the payment is not the same person as the taxpayer who owed the tax.

• A payment made under a contract settlement in connection with tax believed to be due counts as an amount paid by way of tax for the purposes of claiming relief for overpaid tax under paragraph 13A.
• Where the person who paid under the contract settlement (the payer) is different from the person who actually owed the tax (the taxpayer), additional rules apply to ensure HMRC's defences against the claim extend to the conduct and circumstances of the taxpayer as well as the payer.
• Where the grounds for repaying the payer also justify an assessment or determination on the taxpayer, HMRC may set off the amount repayable to the payer against any amount owed by the taxpayer, discharging both obligations to the extent of the set-off.
• A contract settlement is defined as an agreement made in connection with any person's liability to make a payment to HMRC under any legislation.