Taxation of exploration for, and production of, oil and gas in the UK and on the UK Continental Shelf
As announced at the Summer Budget (8 July 2015), the Government intends to broaden the definition of expenditure to be treated as Investment Expenditure for the purposes of the Investment Allowance and the Cluster Area Allowance.
HM Treasury issued a note to industry setting out the proposed changes, effective from 8 October 2015, to treat as Investment Expenditure certain discretionary non-capital spend and spend on long term leasing of production units and HM Revenue & Customs have published draft Regulations and a Tax Information and Impact Note.
Date of material completion of a project described in a Field Development Plan or Field Development Plan addendum
For the purposes of the investment allowance introduced by Finance Act 2015, the Secretary of State may determine a day on which a project was materially completed. The OGA publishes lists of projects which it understands to be materially complete (PDF). The projects are listed separately for new fields which qualified for a field allowance and for incremental projects which qualified for a “brownfield allowance” (ie an allowance as an additionally-developed oil field). For all projects materially complete by 1 April 2015, that date will be determined as 1 April 2015.
The operator of, or any licensee with an interest in, any field with a project that they think is materially complete but not so shown on these lists should advise Mike Earp (details as below) as soon as possible, providing a rationale for that view. The lists will be kept under review and updated from time to time.
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