OT21435 - Field allowance: amount of field allowance for an accounting period where equity share changes

[Field Allowance was superseded by Investment Allowance which was introduced by Fiance Act 2015 and applies to expenditure incurred on or after 1 April 2015. See OT21550 for guidance on Investment Allowance.]

The legislation introduces the concept of 바카라 사이트˜reference period바카라 사이트™. A reference period continues while the company바카라 사이트™s equity share in the field remains unchanged and an amount of the company바카라 사이트™s field allowance is activated in respect of each reference period.

The amount activated for the reference period follows the model of the straightforward case of an unchanged equity share. The activated amount is the smallest of:

  • The relevant activation limit,
  • The company바카라 사이트™s relevant income from the field in the reference period, and
  • The unactivated amount of the field allowance at the start of the reference period.

The 바카라 사이트˜relevant activation limit바카라 사이트™ also follows the straightforward model, and is given by the formula:

T/5 x E x R/365

where

  • T is the total field allowance for the type of field,
  • E is the company바카라 사이트™s share of equity in the field during the reference period, and
  • R is the number of days in the reference period.

The company바카라 사이트™s relevant income from the field in the reference period needs to be calculated, and is given by the formula:

I x R/L

where

  • I is the company바카라 사이트™s relevant income from the field in the whole accounting period,
  • R is the number of days in the reference period, and
  • L is the number of days in the accounting period for which the company is a licensee in the new oil field.

Where a company holds more than one field allowance for a field, to determine the amount of a company바카라 사이트™s field allowance to be activated the amount of the company바카라 사이트™s relevant income from the field in the reference period is to be reduced by the amount of any earlier field allowance activated for the reference period. If a company began to hold two or more field allowances at the same time, the company can choose the order in which it is to be viewed for the purposes of CTA2010\S341 as having begun to hold them.