OT21200 - Corporation Tax Ring Fence and Supplementary Charge

Supplementary Charge: Introduction

Finance Act 2002 introduced, with effect from 17 April 2002, a 10% supplementary charge on companies producing oil or gas in the UK or on the UK Continental Shelf, to be levied on their ring fence profits with no deduction for financing costs.

At the same time, special 100% first-year capital allowances were introduced for investments from 17 April 2002 in the ring fence in plant and machinery (24% for long-life assets) and mineral exploration and access.

This guidance is arranged as follows

• supplementary charge – general provisions: FA02/s91 and ICTA88/ s501A ( OT21202 onwards),
• management provisions to bring the supplementary charge into the general machinery for corporation tax: FA02/s92 and ICTA88/s501B ( OT21215 onwards),
• transitional provisions for the introduction of the supplementary charge: FA02/s93 ( OT21220 onwards),
• plant and machinery, and MEA ring fence first-year allowances: FA02/s63 and Sch21 ( OT21230 onwards).