Part 2 Receipts Arising from Decommissioning
Finance Act 2013 (2013 c 29) | Legislation

Part 2 Receipts Arising from Decommissioning

Calculation of profits chargeable to corporation tax and supplementary charge

21

In Chapter 4 of Part 8 of CTA 2010 (oil activities: calculation of profits), after section 298 insert—

“Receipts arising from decommissioning
298A Receipts arising from decommissioning

(1)     This section applies if—

(a)     a company that is or has been carrying on a ring fence trade (“the defaulterâ€) has defaulted on a liability under—

(i)     a relevant agreement, or

(ii)     an abandonment programme,

to make a payment towards decommissioning expenditure,

(b)     another company that is or has been carrying on a ring fence trade (“the contributing companyâ€) pays an amount (“the relevant contributionâ€) in or towards meeting the whole or part of the default, and

(c)     the amount of the relevant contribution is less than the sum of the amounts within subsection (2).

(2)     The amounts within this subsection are—

(a)     any payments made (directly or indirectly) to the contributing company by the guarantor under an abandonment guarantee as a result of the defaulter defaulting on the liability,

(b)     any reimbursement payments, and

(c)     any relief from tax which the contributing company obtains in respect of the relevant contribution.

(3)     The difference between—

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