Section 332D | Expenditure on acquisition of asset: disqualifying conditions F1
From legislation.gov.uk
(1)Investment expenditure incurred by a company (“the acquiring company”) on the acquisition of an asset (“the acquisition concerned”) is not relievable expenditure for the purposes of section 332C if either of the disqualifying conditions in this section applies to the asset.F1F2
(2)The first disqualifying condition is that investment expenditure incurred before the acquisition concerned, by the acquiring company or another company, in acquiring, leasing, bringing into existence or enhancing the value of the asset was relievable under section 332C.F1F3F4
(3)The second disqualifying condition is that—F1
(a)the asset—F1
(i)is the whole or part of the equity in a qualifying oil field, orF1
(ii)is acquired in connection with a transfer to the acquiring company of the whole or part of the equity in a qualifying oil field,F1
(b)expenditure was incurred before the acquisition concerned, by the acquiring company or another company, in acquiring, leasing, bringing into existence or enhancing the value of the asset, andF1F5F6
(c)any of that expenditure—F1
(i)related to the qualifying oil field, andF1
(ii)would have been relievable under section 332C if this Chapter had been fully in force and had applied to expenditure incurred at that time.F1
(4)For the purposes of subsection (3)(a)(ii) it does not matter whether the asset is acquired at the time of the transfer.F1
(5)In subsection (3)(c) “this Chapter” means the provisions of this Chapter, and of any regulations made under this Chapter, as those provisions have effect at the time when the investment expenditure mentioned in subsection (1) is incurred.F7
(6)Subsections (7) and (8) apply where investment expenditure mentioned in subsection (1) would, in the absence of this section, be relievable under section 332C by reason of section 332CA (treatment of expenditure incurred before field is determined).F7
(7)Where this subsection applies—F7
(a)subsection (2) is to be read as if after “was” there were inserted “ , or has become, ”, andF7
(b)in determining for the purposes of subsection (2) or (3)(b) whether particular expenditure was incurred “before” the acquisition concerned—F7
(i)paragraph (b) of section 332CA(3) is to be ignored, andF7
(ii)accordingly, that expenditure is to be taken (for the purposes of determining whether it was incurred before the acquisition concerned) to have been incurred when it was actually incurred.F7
(8)Where this subsection applies, in determining whether the second disqualifying condition applies to the asset—F7
(a)the reference in subsection (3)(a)(i) to a qualifying oil field is to be read as including an area which, at the time of the acquisition concerned, had not been determined to be an oil field but which has subsequently become a qualifying oil field,F7
(b)the reference in subsection (3)(a)(ii) to a qualifying oil field is to be read as including an area which, at the time of the transfer, had not been determined to be an oil field but which has subsequently become a qualifying oil field,F7
(c)the reference in subsection (3)(c)(i) to “the qualifying oil field” is to be read accordingly, andF7
(d)the following sub-paragraph is to be treated as substituted for subsection (3)(c)(ii)—F7
(ii)would have been relievable under section 332C if this Chapter had been fully in force and had applied to expenditure incurred at the time when that expenditure was actually incurred and the area in question had been a qualifying oil field at that time.
(9)In subsection (8)(a) and (b) “determined” means determined under Schedule 1 to OTA 1975.F7
(10)In this section any reference to expenditure which was incurred by a company in “leasing” an asset is to expenditure incurred by the company under an agreement under which the asset was leased to the company.F7