Oil Taxation Act 1983 Schedule 2 para 9

Reduction of disposal receipts for brought-in assets

Schedule 2 paragraph 9 ensures that where allowable expenditure on an asset has been reduced under the brought-in asset rules, any disposal receipt for that asset is reduced by the same proportion.

• This paragraph applies where expenditure on a brought-in asset has already been reduced under paragraph 7(4) of Schedule 1
• If a disposal receipt arises in respect of that same asset, the receipt must also be reduced
• The reduction is made by multiplying the disposal receipt by the same fraction that was used to reduce the original allowable expenditure
• This ensures symmetry between the expenditure relief originally claimed and the disposal receipt brought into account

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