What is a chargeable period for a foreign oil field under the Oil Taxation Act 1983?

Under section 7 of the Oil Taxation Act 1983, every half year beginning on or after 1 July 1982 is a chargeable period for a foreign field. A half year runs from 1 January to 30 June or from 1 July to 31 December, consistent with the definition in the Oil Taxation Act 1975.

How are disposal receipts attributed to a chargeable period for foreign fields?

Where chargeable receipts arise from a disposal of oil or rights to oil in a foreign field, they are attributed to the chargeable period in which the disposal actually takes place. The timing of the disposal determines which six-month period the income falls into for tax purposes.

How are non-disposal chargeable receipts allocated under section 7?

All chargeable receipts that do not arise from a disposal of oil are attributed to the chargeable period in which the participator receives the payment or in which it becomes receivable. This means the date of actual receipt or entitlement determines the relevant half-year period for taxation.

Can you give an example of how receipts are attributed to chargeable periods for a foreign field?

If a participator disposes of oil on 15 March 1983, those disposal receipts fall into the January–June 1983 chargeable period. If the same participator receives a separate non-disposal payment on 10 August 1983, that receipt is attributed to the July–December 1983 chargeable period.

Oil Taxation Act 1983 section 7

Chargeable periods and attribution of receipts for foreign fields

Section 7 of Schedule 4 defines the chargeable periods that apply to foreign oil fields and explains how chargeable receipts are allocated to those periods.

Every half year starting from 1 July 1982 onwards counts as a chargeable period for a foreign field.
A "half year" means the same six-month period used in the main Oil Taxation Act 1975 (i.e. January to June, or July to December).
Where chargeable receipts arise from a disposal of oil (or rights to oil), they are attributed to the chargeable period in which the disposal takes place.
All other chargeable receipts are attributed to the chargeable period in which they are received or become receivable by the participator.

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