Corporation Tax Act 2010 section 332HB

Carry-forward of unactivated allowance from a reference period

Section 332HB sets out how any unused (unactivated) investment allowance from a reference period is carried forward to the next period for a qualifying oil field.

• At the end of a reference period, any unactivated investment allowance remaining after deducting activated allowance and equity disposal adjustments is carried forward to the next period.
• The carry-forward amount is calculated as: total unactivated allowance, minus activated allowance for the period, minus any reduction required because of equity disposals made on the day after the reference period ends.
• If the carry-forward amount is greater than zero, it is treated as investment allowance held by the company for the qualifying oil field from the beginning of the next period.
• The "next period" is the immediately following reference period for the same oil field if one exists; otherwise, it is the company's next accounting period.