What is the notional delivery day under Oil Taxation Act 1975 Schedule 3 Paragraph 1A?

The notional delivery day is the specific reference date used to determine the market value of oil for petroleum revenue tax purposes within a chargeable period. It does not have to fall within the chargeable period itself and varies depending on whether the oil has been delivered, appropriated, or remains unsold at the period end.

How is the notional delivery day determined for oil transported by ship with a published loading slot?

For oil shipped directly from the extraction site or piped to a UK port and loaded onto a ship, the notional delivery day is the middle day of the three-day loading slot published by the terminal operator. The slot must be established through proper notification procedures before the end of the calendar month preceding loading.

What is the notional delivery day for oil that remains unsold or undelivered at the end of a chargeable period?

Where oil has neither been sold nor relevantly appropriated at the end of a chargeable period, or where it has been sold but not yet physically delivered, the notional delivery day defaults to the last business day of that chargeable period. This provides a straightforward fallback date for oil not yet moved through the supply chain.

What powers does the Treasury have to amend the notional delivery day rules?

The Treasury can make regulations to substitute alternative notional delivery days, such as the completion of loading date or bill of lading date. It can also vary the number of days in the loading slot if the standard three-day window ceases to reflect industry practice, and specify how to determine the notional delivery day when the revised number is even.

Oil Taxation Act 1975 section Sch 3 para 1A

Determination of market value: the notional delivery day for a quantity of oil

Paragraph 1A of Schedule 3 establishes how to determine the "notional delivery day" for a quantity of oil, which is the reference date used when calculating the market value of oil for petroleum revenue tax purposes.

The notional delivery day is the reference date used to determine the market value of oil for a chargeable period, and it does not have to fall within that chargeable period itself.
For oil that remains unsold, unappropriated, or sold but undelivered at the end of a chargeable period, the notional delivery day is simply the last business day of that period.
For oil that is delivered or relevantly appropriated during the period and transported by ship (either directly from the extraction site or via pipeline to a UK port), the notional delivery day is the middle day of the three-day loading slot published by the terminal operator.
The Treasury has regulation-making powers to substitute alternative dates (such as the completion of loading or the bill of lading date) and to adjust the loading slot definition if the standard three-day window becomes outdated.

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