Oil Taxation Act 1983 section 5

Miscellaneous amendments relating to reliefs

Section 5 makes a series of technical amendments to the expenditure relief rules in the Oil Taxation Act 1975, primarily to accommodate the new tariff receipts regime and to prevent double relief or unfair restriction of allowable expenditure.

• Expenditure on assets that generate tariff receipts is treated as qualifying expenditure for petroleum revenue tax relief purposes, ensuring that costs incurred to enable tariff-related use of an asset are not denied relief.
• Where a long-term asset generates tariff receipts, the portion of expenditure attributable to that tariff-generating use must be fully apportioned to qualifying purposes when calculating relief for the relevant field.
• The rule that previously denied expenditure relief where another person had already claimed relief for the same asset does not apply where the payment constitutes a tariff receipt or disposal receipt of the recipient participator.
• The hire payment restriction in Schedule 4 paragraph 5 of the 1975 Act no longer applies where the payments were received after 30 June 1982, and the rules on limiting relief for asset acquisitions are broadened to cover expenditure on using assets and obtaining related services.

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