What is the purpose of Schedule paragraph 1 of the Petroleum Revenue Tax Act 1980?

Schedule paragraph 1 serves as an introductory provision that establishes how the petroleum revenue tax payable by a participator for any chargeable period in respect of an oil field is to be determined. It sets the framework for calculating payments on account under section 1(1)(a) of the 1980 Act and directs the reader to the remaining Schedule provisions for the detailed computational rules.

How is the tax payable by a participator determined under this Schedule?

Rather than setting out the detailed calculation itself, paragraph 1 directs the reader to the remaining provisions of the Schedule for the actual method of determining tax. The Schedule as a whole provides the computational rules for working out the amount due as a payment on account by a participator for each chargeable period in respect of an oil field.

Which Act do the cross-references in the Schedule refer to?

Wherever the Schedule refers to a section or Schedule number without specifying which Act, those references are to the Oil Taxation Act 1975, not the 1980 Act. This is significant because the 1975 Act contains the core charging provisions, definitions, and rules on assessable profits, allowable expenditure, and reliefs for petroleum revenue tax.

How does the Petroleum Revenue Tax Act 1980 relate to the Oil Taxation Act 1975?

The 1980 Act builds on the foundations of the Oil Taxation Act 1975 by introducing the payments on account regime for petroleum revenue tax. It relies on the 1975 Act's machinery for the underlying tax computation, including rules on assessable profits, allowable expenditure, and reliefs. The 1975 Act contains the core charging provisions and definitions.

Petroleum Revenue Tax Act 1980 section Schedule paragraph 1

Determining tax payable for payments on account

Schedule paragraph 1 establishes how the tax payable by a participator for any chargeable period in respect of an oil field is to be determined for the purposes of calculating payments on account.

The paragraph supports the payments on account mechanism set out in section 1(1)(a) of the Petroleum Revenue Tax Act 1980.
Tax payable by a participator for each chargeable period in respect of an oil field is to be calculated according to the remaining provisions of the Schedule.
The calculation rules are contained in the subsequent paragraphs of the Schedule, which this paragraph introduces.
References to any section or Schedule within the subsequent provisions are references to the Oil Taxation Act 1975, not to the 1980 Act itself.

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