Section 332C | Generation of investment allowance

(1)Subsection (2) applies where a company—

(a)is a participator in a qualifying oil field, and

(b)incurs any relievable investment expenditure on or after 1 April 2015 in relation to the oil field.

(2)The company is to hold an amount of allowance equal to 62.5% of the amount of the expenditure.Allowance held under this Chapter is called “investment allowance”.

(3)For the purposes of this section investment expenditure incurred by a company is “relievable” only if, and so far as, it is incurred for the purposes of oil-related activities (see section 274).

(4)Subsections (1) to (3) are subject to—

(a)section 332D (which prevents expenditure on the acquisition of an asset from being relievable in certain circumstances),

(b)section 332DA (which restricts relievable expenditure in relation to an oil field that previously qualified for a field allowance under Chapter 7 as a new oil field),

(c)section 332DB (which restricts relievable expenditure in relation to a project by reference to which an oil field previously qualified for a field allowance under Chapter 7 as an additionally-developed oil field), and

(d)section 332DC (which prevents certain expenditure from being relievable if it relates to an oil field in respect of which onshore allowance may be obtained under Chapter 8).

(5)Investment allowance is said in this Chapter to be “generated” at the time when the investment expenditure is incurred (see section 332K) and is referred to as being generated—

(a)“by” the company concerned;

(b)“in” the qualifying oil field concerned.

(6)Where—

(a)investment expenditure is incurred only partly for the purposes of oil-related activities, or

(b)the oil-related activities for the purposes of which investment expenditure is incurred are carried on only partly in relation to a particular qualifying oil field,

the expenditure is to be attributed to the activities or field concerned on a just and reasonable basis.