Introduction Overview
923.This Part contains rules relating to the corporation tax charge, including the supplementary charge, on profits from oil extraction and related activities. It rewrites Chapter 5 of Part 12 of, and Schedule 19C, to ICTA, sections 62 to 65 of FA 1991 and Schedule 44 to FA 2009. Section 496A of, and Schedule 19B to, ICTA (exploration expenditure supplement) are not rewritten. These particular rules apply only to expenditure incurred before 1 January 2006. They are therefore of limited future application.
924.Some of the source legislation relates to both income tax and corporation tax – the necessary rules for income tax are inserted into ITTOIA (after section 225) by TIOPA, which comes into effect at the same time as this Act.
925.A number of PRT definitions are used in the corporation tax and income tax rules, and some parts of the legislation depend on calculations made for PRT purposes. In particular the legislation uses the PRT term “participator” (see section 12(1) of OTA 1975). The legislation for PRT is not itself being rewritten.
926.The definitions of “exploration and exploitation activities”, “exploration and exploitation rights” and “designated area” are in section 1313 of CTA 2009. The equivalent income tax definitions are in section 874 of ITTOIA.
927.The extension of the United Kingdom to its territorial sea for the purposes of the scope of corporation tax, in section 830(1) of ICTA, is rewritten in section 1170 of this Act. The corresponding rule for income tax is section 1013 of ITA.
928.Oil is used as a shorthand throughout the commentary on these sections, but unless specifically mentioned the same rules and considerations apply to gas and other associated products.
929.The material is organised as follows:
	Chapter 1: Introduction
	Chapter 2: Basic definitions
	Chapter 3: Deemed separate trade
	Chapter 4: Calculation of profits
	Chapter 5: Ring fence expenditure supplement
	Chapter 6: Supplementary charge in respect of ring fence trades
	Chapter 7: Reduction of supplementary charge for certain new oil fields