Taxes Management Act 1970 section 77J

Meaning of "related to a licence" as respects tax, or profits or gains

Section 77J defines when tax, profits or chargeable gains are considered to be "related to a licence" for the purposes of this Part of the Act, particularly in the context of oil and gas exploration and exploitation activities.

• Tax is related to a licence if it is charged on profits or chargeable gains that are themselves related to that licence.
• Profits or chargeable gains are related to a licence if they arise from activities authorised by the licence, or from activities carried on in connection with those authorised activities.
• Profits or chargeable gains from the disposal of exploration or exploitation rights connected with licence activities are also related to the licence, including disposals of unlisted shares deriving their value from such rights.
• The section defines key terms including "designated area", "exploration or exploitation activities", "exploration or exploitation rights", "shares", "unlisted shares" and "recognised stock exchange".