Oil Taxation Act 1983 section 8

Exclusion of certain tariff receipts from mobile assets no longer used in oil fields

Section 8 deals with the circumstances in which tariff receipts from a mobile qualifying asset are excluded from a participator's assessable income once that asset has ceased to be used in connection with any oil field.

• The rule applies when a mobile qualifying asset generates tariff receipts but has ceased to be used in connection with any oil field in which the participator (or a connected person) is involved.
• A two-year grace period runs from the date the asset ceased to be used in any such oil field, during which tariff receipts continue to be taxable as normal.
• After the chargeable period containing the second anniversary of cessation, further tariff receipts are excluded — unless they relate to use of the asset before the end of that chargeable period.
• During any chargeable period in which the asset is not being used in connection with an oil field, receipts falling outside the grace period and not attributable to earlier use are disregarded for tariff receipt purposes.